Don’t let your outstanding study fees keep at you up at night

If you are struggling with outstanding study fees at your institution do not despair.  Students on average struggle with paying their study fees as well as entertaining their busy student lifestyles due to the fact that they usually have little or no income at all.

Although receiving those threatening SMS’s at the end of every week or month might cause feelings of fear and despair, don’t give up hope help might be easier to access than you think.

The best way to deal with debt is to be aware of the problem and to manage it so that you are in control.

Here are a few tips to help you gain control.

Don’t stress,

As the only education finance specialist in the country Eduloan wants to help you tie those loose ends.  All you need to do is, go on to our website: www.eduloan.co.za and fill out an application form.  You might also consider going to an Eduloan office situated conveniently for you on campus to find out what other choices you have in this regard.

Ignoring those letters wont make the problem go away

Your debt won’t just go away and if you choose to ignore the problem it will only get worse.  The best way to deal with debt is to deal with it head on, know how much you owe and correspond with those you owe informing them of your current situation. Keep copy of these emails and written letters.

Double your income

Most of the time your student loan / grant won’t cover all your expenses.  Apply for a waiter job or something that will secure another source of income.

Budgeting

Most of the time, working on a budget will entitle you to distribute your money accurately and help you not go without the essentials.

Advice is always welcome

Speak to our Eduloan client services agents right on campus for some sound advice.

Never give up!

Giving up will mean that your debt has gained control of you and your life and this will only make things worse for you and those around you.  Pay those that need paying or try your best at persuading them to accept the offer that you can make.

As the leading education finance specialist, Eduloan caters for all levels of tuition. Whether you need to settle your outstanding balance, looking to continue your studies or if you are already working and hope to improve your skills, we have a study loan solution for you. Visit our website for more information or SMS “edu” to 32150 & we’ll call you back! (SMS charged at R1).

Laughing All The Way To The Bank

By David Scholtz - Chief Financial Officer at Eduloan

Few of us can afford tertiary studies without a loan. And, let’s face it, to invest in your future by securing a study loan can be an excellent decision as long as you understand exactly what the loan entails and where it will take you.

Before you even consider a loan, think long and hard about your future career path and how your studies will get you there. It’s no use choosing a career, studying for three or four years and then you can’t find work.

Proper career planning, finding your niche in a job market where critical skills are key in finding employment and good management of your finances all play a crucial role in your or your child’s future.

It is a sad reality that South Africans are generally ignorant about personal finance, and many live by the habit of spending now and paying later. Currently the ratio of debt to disposable income of households is around 76%, it tells you what percentage of consumers’monthly gross income goes toward paying off debts. About 47% of credit active consumers are two months in arrears or more. About 14% of these consumers have judgements or administration orders against them. A fifth of credit-active consumers are three months or more in arrears. This paints a picture of a nation overextending itself.

There are several ways of getting and staying out of debt.

The first is education about managing your personal finances and the cost of debt.

People who know the meaning of debt, a loan and saving money- and who understand the impact of these - are the people who can plan their lives and ensure a better future for themselves and their dependants.

Debt consolidation is another popular way of alleviating the burden of over-indebtedness.

While this may be a good idea for some, it can result in consumers being locked in to paying off their debts for longer periods and effectively at higher interest rates and fees.

 The main appeal of debt consolidation is convenience.

How does it work? Instead of a consumer paying off a number of different loans every month, which might have different interest rates, the consumer can just apply for one big loan, pay off all the other debts they have, and then be left with making a single payment towards that loan every month. The repayments are usually lower instalments, giving them more disposable income, which at first glance seems very attractive.

What most people are not aware of is that debt consolidation locks you in. You still end up owing the same amount of money, but pay your debts off over a longer period and not always at the lowest available interest rates. This means you might end up paying more in the long run. All that is happening is that the repayment of the debt is delayed from the immediate to long-term.

The best option remains to pay off all debt as soon as possible, and then start saving the amounts that you formerly paid over to creditors.

The impact of over-indebtedness on the financing of study loans is considerable. All credit providers look at certain criteria. The credit providing environment is regulated and interest rates are determined based on creditworthiness which includes both affordability and behavioural history. First they will assess the affordability of the commitment to the consumer; they will look at the regular expenses, the disposable income, repayment track record and credit history. The industry is regulated and there are strict rules in place. If you are not creditworthy, it will prove difficult to get a loan.

Eduloan’s model is slightly different to that of micro lenders or banks. When looking at credit our lending is to focus more on salary deduction, whereby we collect the amounts owed via the employer and not the individual’s bank account. The funds are also disbursed directly to the educational institution.

Although Eduloan’s method of granting loans falls under unsecured lending, we have the ability to collect before the person gets his take home salary, thereby protecting our clients from defaulting as he doesn’t have to still pay his loan back from the take home portion.

We also educate clients about their loans. It is all about understanding the value of the loan, how the loan is structured and, if denied, explaining why the loan was denied. We explain exactly how Eduloan loans work in terms of the terms and installments. We are very transparent and there are no hidden costs. The interest rate is fixed, and the installments remain the same for the period that clients sign for.

Here is our advice to parents who want to be able to finance their children’s  education:

•         Live within your means and save
•         Don't spend what you don’t have.
•         You need a savings buffer for emergencies, or for when interest rates go up.
•         Try and save as often as much as possible.
•         Don't buy on credit, especially for funding living expenses and holidays.
•         Have a plan – save for your children’s or your own education, or invest elsewhere.

Mindsets about financial literacy need to be changed, and not only of those who want to secure their future. Corporate South Africa and other employers have a responsibility too. The latter should consider offering financial literacy courses for their personnel, who can then teach the basics to their children at home.

When you look at debt, you need to understand that not all debt is bad, specifically debt that will contribute to your financial well being. Educational debt falls into this category as it gives you the opportunity to invest in your own or your children’s education and will go a long way in setting up the foundation for a debt free future as education is key in improving your income earning potential.

ABOUT EDULOAN

Eduloan is a leading education finance specialist operating in Southern Africa. Since its inception in 1996, Eduloan has provided more than 7200 000 study loans valued at R3.7-billion and continues to help thousands across Africa unlock their true potential. Currently, Eduloan approves between 40 000 and 50 000 loans annually to students, a significant proportion of them working professionals.

Eduloan’s loan offerings include repayment options at extremely affordable, fixed-interest rates, for the duration of the loan period. 

Study fees are paid by Eduloan directly to the institution, taking the administrative burden away from the student/corporate institution.  Loans can be paid back either through a salary deduction or a debit order.

For more information, call Eduloan’s Client Services Department on 0860-55-55-44 or visit www.eduloan.co.za. Follow us on Twitter/EduloanSA and Facebook/EduloanSA.

Planning (And Sticking) To Your Budget

Students are notorious for being broke or short of cash. But how can you budget that little money that you earn from your part-time and weekend baby-sitting jobs to ensure that you make it to the end of the month? This week we take a look at budgeting and how you can stick to it!

A budget is a plan that you put together to account for your income and expenses. This means that you plan your money so that your expenses do not exceed your income and that you can reach your financial goals – whether they include saving for a car or anything else. If you stick to your budget, this can be a very important tool to make sure that you get to the end of the month without having to worry about your pockets being empty at the end of the month.

Make a list of your income

Make a list of all the income you receive in a month. This includes pocket money and any other money you receive from odd part time jobs as well as from any bursars. You can also include your study loan amount, since you will have to deduct your expenses from this as well.

Plan your expenses

Make a list of all your expenses. Include your tuition fees, cost of textbooks, any study equipment you might require, your accommodation costs, the money you require for food as well as traveling expenses. You can also plan any expenses that might come about in the month like any birthday presents you might need to buy, maintenance costs on your car or even just holiday pocket money.

Split your expenses into categories

Take the list of your expenses and prioritise them. This is important because you might have to exclude something from your budget in the first month and make provision for it in the next month when you have less important things to budget for.

Once you have made your list of expenses and marked the most important ones, you can deduct your expenses from your income. Make sure that you are not in a negative balance. If you are in a negative balance, you will have to revise your expenses to ensure that you can pay for the most essential things.

Be realistic!

Try be as realistic as possible. If you are realistic, it will be much easier to stick to your budget. Check in on your spending every now and then throughout the month to make sure that you are well within budget.

You can visit our website to use our budget calculator. This will help you establish a basic budget. Remember that your budget might change from month-to-month and that you will have to keep your calendar in mind when you plan your budget. 

10 Ways Your Education Equips You For The Working World

They always say that every bit helps, but what does school, college and university actually offer your career? Below we take a look at 10 ways your education can get you ready for the working world:

One

Writing skills is something you get to work on every day at school, university or college. Whether you learn basic writing etiquette, how to write different types of documents or how to adjust your tone of voice, this skill will be one you will use well beyond the deadline for you 5 000 word essay.

Two

Speaking skills are important in addressing clients or suppliers and colleagues one-on-one or even speaking to a group of people. It is very important to keep in mind what you discuss, how you discuss it and how you interact with others, depending on the situation. Being able to converse in a variety of situations will help you in any industry!

Three

Group work and other projects where you have to work in teams are important for the “real world”, mainly because you will have to deal with a range of different personalities and types of people in your day-to-day life.

Four

Problem solving is an integrated part of your curriculum from preschool. In the beginning you are asked to place a shape in its allocated space or to build things with building blocks. When you get a bit older, you have a complex mathematics equation in algebra as well as other challenges such as completing something according to a ‘brief’. The ability to problem solve is applied to your day-to-day life, but is even more valuable in the workplace.

Five

Every time you participate in class or if you choose a topic for a project, you learn to take initiative. Employers love candidates who show initiative, come up with new ideas and who can track their activities throughout a project.

Six

Throughout your studies, you will be faced with deadlines. Some of them will be for larger projects that will allow you more time to meet the deadline and some tasks will have to occur in a much shorter time frame  You might have more than one subject and that means multiple deadlines. Add your extramural activities like sport, hanging out with family and friends and other commitments and you have tons of deadlines to juggle. Time management is a very important element of the working world… so start focusing on this as soon as possible, because missing a deadline in the work environment might have larger penalties than a deduction of 5% off your assignment.

Seven

Every time you choose not to copy your friend’s work or just taking information off the Internet, you choose integrity. Honesty and integrity are highly regarded values when employees look for suitable candidates.

Eight

Often your teacher will choose not to keep an eye on you, allowing you to take responsibility for your actions and for the projects that you have to do. This is to teach you responsibility. As you grow, you might not have someone available to take the responsibility on your behalf, to make decisions or to own up to problems when they occur.

Nine

By engaging in a variety of activities, you learn to develop different skills. Even if you are not sporty, partaking in sport will assist you in developing skills like hand-eye co-ordination or teamwork where as art might inspire you to get creative. By engaging in a variety of activities, you can remain stimulated and it will allow you to keep on growing your skills set.

Ten

The knowledge you learn at school, college and university will assist you directly in approaching your industry. If you are studying towards becoming an artisan, the skills that you learn are directly transferrable in the working world. Don’t discard your studies, as they can empower you to achieve even more!

Eduloan has a solution for full-time and part-time students and even offer you the opportunity to deduct your fixed monthly repayments from your salary. For more information and to speak to one of our Eduloan consultants, visit our website (www.eduloan.co.za), like our page on Facebook         (www.facebook.com/EduloanSA) and follow us on Twitter (@EduloanSA).

Here are four tips for making study or career decisions

·       Identify career opportunities that suit your interests

·       Evaluate your skills and strengths

·       Research the prerequisites of your chosen career (do you need science or biology or do you need a certain qualification to make sure that you have the knowledge to practice in your field?)

·       Constantly develop skills and experience

What You Need to Know About Your Student Loan

Q&A with Eduloan’s Financial Guru

Whether you have your heart set on a certificate, diploma or degree at one of South Africa’s finest tertiary institutions or whether you want to further your education while working, an Eduloan study loan will help you unlock your potential.

It might be a good idea to establish some basic facts about a study loan before you dive into your studies. We chat to Eduloan’s Chief Financial Officer, David Scholtz, who explains the ins-and-outs of your student loan:

Q: What are the benefits of committing to a study loan with Eduloan?

Your study loan is made to your affordability criteria, ensuring you never feel the pressures of being overburdened.  Registration fees, outstanding study fees and other additional costs associated with your studies are covered by our study loans - all you have to worry about is achieving your educational goals. Whether you are looking to increase your salary through improved qualifications, qualify for a better job position or just for personal enrichment, Eduloan will be your partner for your educational journey.
You don't need to put down a deposit and we pay the amount you owe for your studies directly to the institution and then deduct the instalments from your salary or bank account each month, which means no admin for you. Finally, you get repayment periods of 6 to 24 months.

Q: What do I need to apply for a study loan?

Applying to Eduloan is easy! If you are not full time employed, anyone who is can sponsor you. You will need to complete and sign our loan application form (you can download this information from our website) and include the following documents:

• a quotation from the educational institution reflecting your name and student number, the study program, the balance outstanding (if applicable);
• a certified copy of your South African Identity Document;
• you or your sponsor's pay slip (not older than 3 months);
• you or your sponsor's bank statements for the last 3 months. If you or your sponsor are self-employed, we require you or your sponsor's business bank statements for the last 6 months and proof of business ownership as well as you or your sponsor’s certified ID and a quote from the institution.

Once you have compiled all of your document and completed the application form, you can apply online, visit your Eduloan office on campus or giving us a call on 0860 55 55 44.

Q: How do I know how much I can afford?

Eduloan will do an affordability assessment by using the income and expenditure information provided on your loan application form, and by looking at your accounts on the Credit Bureau and a register called the National Loans Register. Based on this, Eduloan will determine whether you can afford the full loan amount you've requested, or alternatively the amount that you would qualify for. Please note that Eduloan will not grant a study loan that is more than the amount that you owe the institution, as the money is paid directly to your account at the educational institution. You can also use our Instalment Calculator as an indication to calculate how much your monthly repayments would be based on your loan requirements.

Q: What if I don’t earn a salary?

If you are not full time employed anyone can apply for a study loan on your behalf, as long as they are in full time employment and provided that the Eduloan monthly instalments does not exceed 25% (based on a one year loan) of your sponsor's monthly basic salary.

Q: What is an interest rate and how is it calculated?

As we all know by now, debt is the amount of money you have to pay back to the person or institution (such as banks or retail stores) from which you borrowed. This amount consists of two parts – the actual borrowed amount, also known as principal debt or capital amount and the interest. Interest is the compensation paid to the person or institutions who lend you the money. It is normally expressed as a percentage of the borrowed amount, e.g. 15% per year. Therefore, it is wise to repay your debt on a monthly basis and not skip payments, as this will significantly reduce the amount of interest you repay at the end of the day. This is relevant to most debt incurred, like credit cards, clothing accounts, car finance etc.

Compound interest occurs when interest is added to the principal debt or capital amount, so that from that moment on, the interest that has been added also itself earns interest. This addition of interest to the principal debt is called compounding. A bank account, for example, may have its interest compounded every year: in this case, an account with R1000 initial principal debt and 20% interest per year would have a balance of R1200 at the end of the first year, R1440 at the end of the second year, and so on.

The effective interest rate is the interest rate on your debt restated from the nominal interest rates as an interest rate with annual compound interest payable in arrears. It is used to compare the annual interest between loans with different compounding terms (daily, monthly, annually, or other). Thus, the quicker you repay your principal debt, the less your effective interest rates will be.

The more diligent you are in repaying your debt, the more controlled the interest on your debt will be. In the end, the sooner you pay off your debt, the less time there will be for the interest to accumulate.

Q: Are there any hidden costs that I should know about?

At Eduloan, there are fixed monthly installments for your study loan which includes an affordable loan origination fee and monthly administration fee, which allows you to budget more effectively. There are no hidden fees and the payment periods are flexible according to your specific needs.

Q: What does my study loan cover?

Your study loan covers a whole lot of student related necessities such as registration fees, books, tool-kits, laptops, tablets and even accommodation for the duration of your studies, as well as your study tuition itself.

Eduloan has solutions for full-time and part-time students and even offer you the opportunity to deduct your fixed monthly repayments from your salary. For more information and to speak to one of our Eduloan consultants, visit our website (www.eduloan.co.za), like our page on Facebook (www.facebook.com/EduloanSA) and follow us on Twitter (@EduloanSA).

The entrepreneurial student – ten ways to supplement your income while studying

Now has never been a better time for tertiary students to start a business.  Much more than the graduates of the past couple of decades, current students need to be prepared to find ways to supplement their incomes. Let’s face it; the cost of living continues to increase every year and the job market is a tough place to break into, making it harder for students to make ends meet while they are studying and to find a job after they’ve finished. 

Launching a business while you’re studying sets you up for success.  Here are ten business ideas you can start while you’re studying that shouldn’t cost you an arm and a leg to set up.  You can use one of these ideas or come up with your own.  Some of them may work better than others, or may not work at all, depending on your personal circumstances.   So choose wisely, and remember to adjust quickly if the business you start isn’t growing.

Before we start, let’s look at some quick tips for creating a successful student business:

* Innovation is good but it can also be overrated.  Don’t feel like you have to come up with the next big idea. The main idea is to start a simple business that generates a profit.  And that’s the main idea.

* Pick an idea that has an immediate and obvious customer base that needs or strongly wants what you plan to sell. Ask yourself if there is a demand for your product or service.

* After your initial investment, don’t put any more outside money into the business.  That’s your test for whether you’re succeeding.  The business needs to pay for itself and pay you.  Once you start, the business should generate enough for you to reinvest into the business and then begin to pay yourself.  If you see things dwindling, figure out whether you need to adjust prices, offerings, or do more marketing and selling.  Pay attention to customer inquiries and demands. They will lead you in the right direction.

* Remember the business is a great experience but it’s not the main reason you are on campus.  You are there to get a great education.  So develop discipline and time management skills that will allow you to go to class, get good results and still operate your business in your free time.

Our 10 student business ideas:

1. Tutoring service – if you’re attending university or college on a scholarship or bursary and know a required subject very well, consider start a tutoring service for local elementary or high school students who want to get into a good university or college like you.

2. Staffing service specializing in internships – start an on-campus staffing service where you help local or national businesses connect with the best students for internships and help students who want to do internships find the best opportunity.

3. Personal training service – are you athletic and into sports?  Think about starting a personal training service for students wanting to get fit and active.

4. Graphic arts and design services for presentations and papers – if you enjoy graphic arts and presentation design and you’re good at it, think about offering these services to students (and perhaps lecturers too) who want to jazz up their research and reports.

5. CV writing service – are you good at finding the best angles to present information? Start a CV writing service helping students put their experience in the best possible format and phrasing to attract interview and career opportunities.

6. Hair styling and grooming services – provide hair cuts or hair styling as a mobile hairdresser or stylist.

7. Babysitting service – if you know how to look after children and you’re responsible and reliable, starting a small au pair business could be an easy way to make extra income.

8. Bookkeeping service – if you’re studying accounting and have a love for numbers offer to keep books for a few small local businesses or find customers online.

9. Photography and video services – if you have a great eye for composing scenes and images consider starting a photography and video service. You can offer your services to students and faculty, take photos and videos of campus events and help local businesses produce and post videos online.

10. T-shirt company – really cool t-shirts just never get old and they’re the standard uniform for lots of college students. Come up with neat designs or funny sayings or create custom shirts for on-campus organisations and find someone to print the shirts for you and you’re in business!

Are you a student thinking about starting a small business? What do you think about these ideas? What are you excited about, or maybe scared about? Tell us what you think in the comments section below!