How can I pay off a DBS student loan quickly? What's the best way to go about doing this?

Hi, I am a graduated with a student loan (under DBS) of approx 6.5k left, I have been struggling to pay off as the interest accumulation is harsh. I'm paying about $500 a month now but that takes up a huge portion of my expenditure.

I recently read that you could stretch your loan payment to maximum and just pay the interest. My question is:

1) Am I still able to do that?
2) Where then can I allocate the $500 to earn a higher return to pay off this quickly?

Thank you!

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Wilson Nid A Break

30 Apr 2020

With 6.5k left, might as well ask a family loan (refinance!) and paid off the bank loan. And arrange to pay back your family with lower interest rate / over longer installment periods.

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Takingstock @

30 Apr 2020

I would assume your loan interest is less than 8% per year... If the documents tell you the effective interest rate, use that as a guide instead. Effective interest rate = interest they described + all other fees involved whether they call it admin or processing fee.

If your situation, I would advise you to just pay off the loan, and target as fast as possible within the best of your ability.

Stretching the loan (and just paying interest) is not worth it.

If I assume the rate you are charged is 4.5%, on 6500, the annual interest is 292.50. Then at 500 paid per month, you might actually clear this in 14 months or so. That's not too bad.

If you change your perspective, paying off the loan is the same as giving you a return of the interest rate, and 4.5% is not bad (considering there is no risk at all). 4.5% is better than cpf sa rate!

If you take the 500 monthly to invest, you will incur fees, and given the current situation is not exactly good, you might not make a good return enough to offset the fees you paid + interest.

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