Education is a right for an individual who wants to learn. However, there are many obstacles for a student that keeps them from the ideal education. One of which is financial capacity.
Tuitions are rising, and it is one of many reasons students cannot graduate on time. If your money cannot pay your tuition in one go, consider getting an educational loan. It spreads out the payment into smaller payments for your finances. The loan helps you manage other transactions as you go. Now ask yourself, is an educational loan ideal for me?
These loans are a case-to-case basis. There are times when a loan is worth the investment, but some are not worth the application. Think of these factors when you apply for a loan.
Completion Of Your Degree
College students finish their degrees but are not always complete in four years. In the Philippines, the Philippine Statistics Authority state that 36.3% of students finished college on time in 2010.
Once you spend another year in school, it adds up to your educational loan. While you can finish your degree at a later time, the loan may end up being your financial burden. As much as possible, get a loan when you are in a pinch instead of getting instant cash.
Repaying What You Borrowed
Educational loans let you borrow a set amount of money. It can be as low as PHP10,000.00 or as high as PHP30,000.00. However, you still have to pay back the loan according to what you borrowed.
It is not recommended to use the loan as free money. Not paying back the loan will be bad for your credit score and credit history. Financial institutions would also consider how you manage your money for loan approvals. You can still get approved for the loan, but the loan terms and conditions will be more costly. Therefore, you pay back what you borrowed.
Your future salary will depend on your capacity to pay back the tuition loan. For example, if you work in engineering or technology, you may pay back what you owe. However, low-paying jobs such as teaching or factory work can pose challenges. These loans tend to be high, and there is a set loan term. If you go beyond the loan term, you have to pay for the possible incurring penalties.
The interest rate varies depending on the financial institution. It depends on your credit score, credit history, and existing transactions. If the high-interest rate is not for you, it shows that the tuition loan may not be for you.
You can compare other existing interest rates to see if they are within your reach. It is better to have an idea of the percentage so you can adjust them to your budget. Ensure that the rates do not conflict with other expenses you have on hand.
Getting your education is possible through a tuition loan with the right financial management. The loan has varying payments; it stretches out the transactions into affordable payments. When you get the loan, consider the interest rate, your income, and how much you need to repay. In the end, it all boils down if you can afford the loan for your education.
Frank is an energetic salesman. On his free days, he spends his time writing and reading about financial plans and educational loans to help the parents and the next generation gain more insight about multiple educational opportunities.