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Published by Afterschool.my on Apr 13, 2015, 03:54 pm
Student loans have enabled many young Malaysians to pursue tertiary education both locally and abroad. There are various loan options for those who want to further their studies but lack the financial means to do so.
Undergraduate students in Malaysia apply for government or private loans.
While such resources certainly aid students, many find themselves thrown into a pit of debt upon graduating. For many, this happens before they even experience a day in the working world. It is easy to understand why this might be a cause of stress or worry - it can be daunting and demotivating to have student loan debt looming over you for a good number of years while you try to find your footing in the world.
It is important to know what you need help with before asking for it, so think about what and where you want to study. Switching courses or universities midway will only cost you more, so be sure about what you want from the start and follow through with your decision.
Apply for scholarships or grants first - seek the options that reward you for excellent academic achievement and come with minimal debt or contract. Consider a tuition payment plan that allows you to make payments over time. Include the opinions of family, friends, and teachers in your decision making process to pick the scheme that works best for you.
How much will your entire education cost you? How much will you have to pay after taking interest into account? What sort of instalment plan will you be able to afford with a starting salary? These are questions you should ask when mapping out the costs of your education. The total sum may include tuition and accommodation fees, textbooks, and supplies.
The technical aspect of loans may be off-putting, which is why many do not have a comprehensive understanding of the deal they are entering and are shocked by the reality later. Some key factors to be aware of include the differences between subsidised and unsubsidised loans, federal or private institutions, and fixed or variable interest rates.
Before entering into an agreement with any party, you should learn all there is to know about them. Whether it is a bank or a federal body, find out what they do and how well they do it. Check with previous loan recipients for feedback and inside information, and know their servicing rates before you sign a dotted line.
Making small payments can reduce your interest balance and keep you aware of your loan. Start saving for payments while still in university, even if you can only spare RM 20 per month. Starting your school loan repayment fund earlier gives you the head start you need to build greater savings - it could also cost less if you repay the loan in a shorter time. You can also plan your progression in the course to fulfil the credit requirement in a shorter period of time.
It is a good idea to get a part time job while still in university. Even working a few hours a day in between classes on campus could make a difference to your repayment fund over the years. To start off, create a plan based on the number of in which years you aim to fully repay your loan. Then, create and follow a monthly budget based on your plan - you should have a rough idea of how much you can spend for the next few years in order to meet your repayment goal.
Many fresh graduates make the mistake of spending too much too quickly. It can be tempting to start purchasing everything as soon as you start earning, but with student loans in the equation, this will have to wait. Stay away from further debt, especially those incurred while purchasing a home or car. Rent a room, ride a bicycle - live as simply as possible until you have paid off your loan. Remember that a larger pool of debt takes a lot more time and effort to get out of.
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