Student Loans; You’re Doing It Wrong.

I’ll admit.

This issue has been bugging me since God-knows-when. Maybe it’s because we all think differently, but it’s confusing since it all has to do with plain common sense.

And coming from a person who, as most people know, is not very good in the common sense department, you know this is some pretty f-ed up shit.

I’m talking about Student Loans.

Now, I’m not sure how it is with international loans, but here in Malaysia, in order to be exempted from paying back your student loans, you have to maintain a CGPA (Cumulative Grade Point Average) of 3.5 and above throughout the duration of your studies.

Now, if you’re naturally a high achiever and have no problems achieving the minimum GPA, fine by me. But I’m talking about all the other students who are, well… average. Me included.

At the university I went to, we wouldn’t get loans for our short semesters. I, as well as a big majority of other students, usually apply for the PTPN loan (Perbadanan Tabung Pendidikan Tinggi Nasional – in other words, the National Higher Education Fund Corporation). When applying, you need to deposit about RM2000. That will be credited back to your account later, if / when your application is approved.

As I said, we wouldn’t have our loans credited for the short semesters.

Logically speaking, what would you do with that RM2000+ once it’s been credited to your account?

Well, unless you have other expenses in which you need to pay back for, I’d think that the rational decision would be to keep that extra money to pay for your tuition fees in the short semester.

Right? 

Well, that’s what I did.

Some of the people I know, though, used that extra money to splurge on stuff. Not that I’m against it, though. It’s your choice after all.

If you splurged on say, RM500 or less, that wouldn’t be quite much of a problem. The problem starts when a student spends thousands, and for petty reasons, like getting that new phone they’ve had their eye on, or some other nifty gadget.

Uhhhh… you DO realise, guys, that in the end, you’d still have to pay back that ‘extra cash’ you had?  Because you’d have to pay back what you borrowed in the first place, ya’know..

So technically, the more of that ‘extra cash’ you spend, (which is really YOUR money in the first place; perhaps that’s why people feel ‘entitled’ to spend it.. because it’s THEIR money after all) the more of YOUR own money is going out too.

And for those who think that they can pay it back in due time when they start working, let me tell you; it’s not as easy as you think it is.

First, because your first job is not guaranteed to be a high-paying one. Second, once you start working, you’ll have more bills to pay, more stuff you’d need to be accountable and pay for. And knowing PTPN, they hound you to start paying back the loan about a month after you’re done with your studies. (I know some people who got that letter within weeks of finishing studies, it’s crazy.)

So to finish paying off the entire amount of your loan would take… oh, give and take.. about 3-4 years minimum, depending on how much you pay every month.

So… still think using that extra money for your own pleasures is a good idea? 

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