Study Loans

Debts is a common problem in Singapore, especially so for those that didn't get scholarships or bursaries to pay off the majority of their studies and didn't get sponsorship from their company or parents. That's all I can think of now.. But if you are one of them.. This may give you a helping hand. This only applies for local govt schools such as poly and local unis.

Prevention Methods:

1. CPF Loans
   
   This is one loan that is preferred not to be taken unless you can't get a bank loan. Why? 'cos it charges you interest the moment you loan the money out, for every school fees payment term. The interest should be around 2.6% per year compound and the moment you graduate, you are already needs to pay about $320 worth of interest (estimated based on 2K sch fees a year with 3 years of studies and 2.6% interest rate) for poly and $1600 worth of interest (estimated based on 6K sch fees a year with 4 years of studies and 2.6% interest) for uni. And the interest continues to compound while you pay off the loan. Yes, some may argue that it's ur parent's money that you are borrowing and you are not worried. But why borrow from them when.. the same amount of money can sit in CPF and earn a similar amount of interest for free?
   
   
2. Bank Loan
   Well this is the loan that I recommends if and only if you are willing to get yourself debt free within the minimum time possible. Why? 'cos bank loans are the only interest free loans during your period of study. Further more, if you are willing to shop for it. You may get yourself something like another interest free period of 6 mths to 1 yr, depending on the economy and our govt's ruling.
   Yes.. This is the best loan you can get apart from a loan from your parents to pay off the study loans as soon as possible. But.. How to do it?

Yes.. how to do it is the main issue discussed in this article. If you want to do it and is willing to do it for all it takes.. This is what you need to do. But please pay off the debt with all your savings 1st only after u secure a job. To ensure that the bank is not mislead that you have the ability to pay off your loan so they can start charging you interest or bill you for the loan.

There are mainly 2 types of path you may want to take:
Poly
University

I'll talk about the cure part another day.