How can you fund your higher education?
You need the right expertise, knowledge and understanding to perform your work in today’s workplace and to achieve your potential. It covers both general competences, such as listening capacity, problem solving and team work, as well as job-specific skills and abilities.
Some occupations usually include your employer in your training and growth, so that he or she is able to learn at work. For others, you will have the underlying skills, knowledge and comprehension to perform the role effectively, but your employer may still provide opportunities for further development.
Why does it matter so much?
It was never more important in these times of rapid change for employers to make sure their staff can carry out the tasks necessary to operate effectively and efficiently.
From an employer’s perspective, investing in training and development should result in:
- Improved efficiency – if people can do their jobs, they are more likely to be
- Productive; ultimately this can have a positive impact on profits
- Better customer service and fewer complaints
- more motivated staff with lower rates of absence and staff turnover
- A flexible workforce
- An enhanced reputation not only with customers and clients but also with
- Potential employees and the wider public.
From your point of view, participating in training and development and being fully equipped to do your job can:
- Give you greater job satisfaction
- Lead to more varied and interesting work
- Give you an edge when applying for promotion or other jobs
- Possibly, mean higher pay!
What happens when you start a new career?
The new workers will be stimulated by all employers. How long and its exact content can vary but you have to be told about issues of health and safety and are usually explained to key staff members, shown and given policy and procedural details.
Initial preparation will also be offered to get you in the work. This may only take some time to work together with an experienced team member or require more in-depth preparation.
So, How can you fund your higher education?
While deciding on the source of funds, borrowers often find themselves in a dilemma between education loans and personal loans. Let us take a closer look at both options and find the right option based on your requirement. How can you fund your higher education?
The rising cost of higher education is one of the most daunting obstacles between students and their dreams. Education borrowing and personal borrowing can prevent financial shortcomings from becoming an obstacle to higher education. When deciding on the source of the money, however, borrowers often become embroiled in a dilemma between educational loans and personal loans.
Let us look closely at both choices and find the right choice based on your demand:
The amount of the loan
Lenders grant training loans, tuition and other associated costs of the course on the basis of the institution. You can use a training loan of up to Rs 80 lakh for studies in India, although it can be as big as the Rs 2 crore for international studies.
Personal credit is generally limited to Rs 40 lakh, on the other hand. Since the end-use of a personal loan can not be restricted, you can also use it to cover other expenses, including relocation costs, external coaching costs, etc., which may not be covered by an educational loan lender.
Rate of Interest
Education loans can be made available at a lower interest rate, ranging from 7.95% to 15.2% p.a. Some lenders are offering girls 0.5% additional concessions. In addition, if students commence paying the loan during the moratorium period, they may receive another 1 per cent concession.
On the other hand, your interest rate output may range from 9.5 to 28% p.a., if you choose personal loans. Visit the financial market online to compare the interest rate on both loans. Choose one that is synchronized with your needs.
Period of moratorium
In comparison to a personalized loan with EMI loans being repaid immediately, the duration of the moratorium for student loans is up to 12 months during the process of completion. It gives lenders ample time to find a job, to ensure that the loan is paid regularly.
The moratorium duration may also be extended if the student chooses to pursue a start-up undertaking after graduation, subject to the consent of the lender, in particular conditions such as medical emergencies, unemployment or during an incubation phase.
Tenure of loans
The longer the service, the fewer the EMI, and vice versa. The loan may take up to 15 years in the case of an education loan. Together with a lower interest rate, such a long tenure normally leads to less EMI output.
The shorter personal loan term of up to 5 years, combined with a comparatively low-interest rate, will lead to a higher EMI level.
Exemptions from taxes available
Section 80E provides education loans tax advantages in view of the interest charged for up to eight years from the year you begin to repay the loan or until the debt is repaid entirely as early as possible.
Please note that tax deduction does not qualify for the principal component. To personal loan lenders, tax exemptions are not eligible.
Assurance / Guarantee
Education loans usually require a co-applicant like your parent. If the loan sum exceeds 4 lakh, borrowers can request third party guarantor. In addition, for a loan exceeding Rs 7.5 lakh, an additional collateral guarantee may also be needed. Neither a guarantor nor collateral security to use the loan is provided by the personal loan.
Lower interest rate, longer-term, moratorium and tax advantages make student loans favourably available to borrowers as far as personal loans are concerned. Consider opting for a personal loan if a co-borrower, guarantor or sufficient collateral is not eligible for an educational loan or in the case of a higher loan than your eligibility.
How can you fund your higher education?