5 reasons why educational loans are the right way to fund your higher education

 

Students who have the merit to study beyond junior college often do not have money to fund their higher studies. Educational loans help such students to fulfil their dreams of earning a higher degree, by financing their education expenses. Education loans—as the name suggests—are specifically provided for the purpose of helping students financially gain expertise in their choice of course. In this article, we will tell you 5 reasons why education loans are the right way to fund your higher education.

 

 


 

  1. Covers all education-related expenses

An education loan not only covers the tuition fee of the whole course the student pursues but also covers other higher education related costs. Those costs are: the money needed to travel to the city where the student’s university is based, to live in that city for the whole duration of the course, mess expenses, exam fee, library fee, laboratory fee, stationery expenses, and so on. This makes educational loans the right choice to fund your higher education.

 

  1. Protects your savings from being used up

Sometimes, students use their family’s savings to fund their higher education. This is not advisable as families create these savings to secure their future financially. An education loan helps you side-step the need to use your family’s savings to fund your education, making loans the right choice.

 

  1. Provides a moratorium period

Financial lenders do not expect the students to repay education loans as soon as they earn their higher degree. They provide a grace period to the student, also called the moratorium period. It gives the student time to land a job, start saving money from their salary, and then repay the education loan. Usually, this moratorium period lasts up to 1 year from the time the student completes their education, or up to 6 months from the time the student gets the first job, whichever comes earlier.

 

  1. Allows ease of repayment

Financial lenders do not expect the students to repay their educational loans in lump sums. They allow ease of repayment to students. Lenders set an EMI value—a small sum a student has to pay every month—according to the repaying capability of the student. The EMI value is set high enough for the student to repay the loan in as little time as possible, while at the same time keeping it within the student’s financial reach every month.

 



  1. Helps inculcate good financial habits

Repaying the EMIs of your study loan on time helps build a good financial habit in your life. Paying the EMIs of the education loan helps the student become a responsible citizen. It also helps improve the credit score of the student, thus, helping them to get a loan for other purposes, like a home or a vehicle in the future without much hassle.

 

So, these are the 5 reasons why an education loan is the best choice to fund your higher education. We hope that after reading this article, you have finer knowledge about educational loans than you did before. All the best!

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