Education loans have become a common way for students to finance their higher education, especially with the rising cost of tuition fees. However, repaying these loans after graduation can be a challenge for many students. While many choose to opt for full-time jobs to repay their loans, some may wonder if it’s possible to pay off their education loan through part-time jobs. Here’s what experts have to say.
Part-time jobs can certainly help students repay their education loans, but it may not be enough to cover the entire loan amount. According to financial experts, students should aim to earn at least 20% of their monthly income from part-time jobs to make a significant dent in their loan repayment. This means that if a student’s monthly income is Rs. 30,000, they should aim to earn at least Rs. 6,000 from part-time jobs.
However, experts caution that relying solely on part-time jobs to repay education loans can be risky, as it may not provide a stable source of income. Part-time jobs can be unpredictable, and there may be months where a student may not be able to earn enough to make a significant loan repayment. In such cases, students may end up defaulting on their loans, which can have serious consequences such as a damaged credit score.
Instead, experts recommend that students opt for full-time jobs after graduation, as they provide a stable source of income and benefits such as health insurance, paid leave, and retirement plans. Students can also opt for side gigs or freelance work in addition to their full-time jobs to earn extra income and make additional loan payments.
Apart from part-time and full-time jobs, students can also consider other options to repay their education loans. One such option is loan forgiveness programs, which are offered by the government and some employers. These programs forgive a portion or all of a student’s education loan in exchange for working in certain fields or industries for a specified period of time.
Another option is to refinance the education loan. Refinancing involves taking out a new loan with a lower interest rate to pay off the existing loan. This can help students save money on interest payments and reduce their monthly loan payments.
In conclusion, while part-time jobs can certainly help students repay their education loans, it may not be enough to cover the entire loan amount. Students should aim to earn at least 20% of their monthly income from part-time jobs and also consider other options such as full-time jobs, loan forgiveness programs, and loan refinancing to repay their education loans. It’s important to have a repayment plan in place and to make timely loan payments to avoid defaulting on the loan.
