• Parushni Jathar

Student Loans



"An investment in knowledge pays the best interest" every time we invest in knowledge, we always gain something in return. It's safe to say that education is the most trustworthy investment opportunity. Unfortunately, everything has a price tag in today's materialistic world, and so does education. It's appalling to know that the more potential the student possesses, the higher the price will be set. So what can a bright student who could be the next Mark Zuckerberg or Michelle Obama do to secure their future with affordable and quality education going hand-in-hand? Student Loans. A student loan is a type of loan designed for post-secondary education and compensating for books, tuition, fees and living expenses. But are Student Loans secure for students' future?

One of the main advantages is that it provides a chance to the needy. It enables them to pursue higher education and make a career for themselves. These are designed so that students don't have to repay right away; they can wait for the education tenure to end and then begin to repay in instalments from their salaries. This ensures that there isn't a burden on the students in their learning process and can give complete attention to their education. Another advantage that might turn everyone's heads is the fact that student loans have low-interest rates. That implies that lower the interests means lower the monthly instalments and hence less pressure on the borrower. Adding on, there is no need for any security up to a certain amount in student loans. Thus, the borrower is saved from the stress of arranging for security as with other loans where the borrower has to put for security to take a loan from the bank or financial institution. Lastly, who doesn't enjoy being independent, having that sense of standing on our own feet and becoming our best version!

Everyone has set some goals for themselves according to their terms and conditions. Hence their needs also vary from one another. What might be a goal for someone might be a red flag for the other. Therefore knowing the other side of the student loans is necessary.

Suppose, due to some reason, after completing a degree, a student is unable to get a good job. In that case, it can lead to a big problem because if the income levels of a person who has taken a student loan do not match up with their monthly loan repayments, then it can lead to defaults, and these defaults will ruin the credit history of an individual and hence getting a good job is very important if one wants to repay the student loan on time and without default. Another disadvantage of student loans is that an individual is getting into debt at a very early age. Due to it, their focus shifts towards repaying the loan rather than focusing on their career. Student loan leads to the individual being in constant stress. Therefore their creative abilities take a backseat, and the chances are that an individual will sacrifice long term growth in their career for short term financial benefit. Hence, student loan, in a way, is a deterrent to individual success.

It can be better understood with the help of an example, suppose for example, if a person after completing the degree is getting offers from 2 companies, one is offering a $50000 yearly package while the other is offering $70000, but the scope of growth and career opportunities is high in the first company then the person who has taken loan would go for the second company even if it means sacrificing the career of an individual. Now, if you have taken a federal student loan and under some circumstance, you are unable to repay the amount, there is a way out for you! It's called Student Loan

Forgiveness. Student loan forgiveness is the process of discharging or cancelling student loan debt, typically after meeting specific requirements. Unlike a debt settlement or bankruptcy, where some or all of certain types of debt can be discharged, student loan forgiveness doesn't hurt your credit and can be an excellent way to get help paying back what you owe.

There are about five types of students that consider your eligibility. Teacher Loan forgiveness is the first criteria for teaching an elementary or secondary school serving low-income families for five consecutive years. This criterion seems to go hand-in-hand with the objective of student loans to help the needy get quality education. Another standard, Public Service Loan Forgiveness, If you work full-time for a government or not-for-profit organization, you may qualify for forgiveness of the entire remaining balance of your Direct Loans after you've made 120 qualifying payments—that is, ten years of payments. An Income-Driven Repayment, a repayment plan, can be followed, which will be constructed based on your income so that any of the remaining balance of your student loan will be forgiven after you make a certain amount of payment. Now since Loan forgiveness is a U.S. led program, it will acknowledge your service to the country and provide unique benefits and repayment options for your student loans available from the U.S. Department of Education and the U.S. Department of Defense. Lastly, the Americorps is a benefit received by participants who complete a

term of national service in an approved AmeriCorps program—AmeriCorps VISTA, AmeriCorps NCCC, or AmeriCorps State and National. After you complete your service, you are eligible to receive a Segal AmeriCorps Education Award, which can be used to repay qualified student loans.

The international students who dream of achieving their degrees from a different country might have more obstacles to tackle. One such fintech platform is Prodigy Finance, which genuinely looks after

international students and makes their educational process seamless. Many loans ask for collaterals,co-signers, guarantors or documentation, which students might not have. To not be a

barrier for the students, the Prodigy Fund made education accessible to all students based on their educational qualifications, potential, current situation and previous credit history.

Education might come with a price and thousands of obstacles, but despite that, if we believe in ourselves and have the will to fight it through, then the sky's the limit, and no one can stop us

from being the next generation who will be saving the world.