Anonymous

04 May 2020

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Would a CPF Education Loan or Tuition Loan be better for my situation?

Parent is >55, and is eligible to waive off repayment, however CPF states that repayment can only be waived after I graduate from Uni.

I do not have any siblings so I'm not too clear on Uni fees payment. Hence, I would like to ask how is the payment for Uni fees made if I were to use the CPF Education Loan and would a Tuition Loan be better since the interest for it only starts accumulating after graduating, unlike CPF.

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Gabriel

04 May 2020

Undergraduate at National University of Singapore

Hey Anon, to begin with, let's take a look at the overview of both loans:

1) CPF Education Loan - Interest starts the moment the loan is taken and interest rate on loan is lower than tuition loan.

2) Tuition Loan - Interest-free during the course of your study but interest rate on loan is higher than CPF education loan.

If you're able to pay up the loan upon graduation or at least within the first few years, go for the tuition loan. However, if you require a longer period of time, go for the CPF education loan. In your case, since your parent is able to waive off the repayment, assuming they have set aside the Full Retirement Sum in their Retirement Account and they're willing to waive off the repayment, I think that the CPF education loan would be a better choice for you.

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