Anonymous
Should I repay my education loan now? (4.75% pa).?
I would like to kindly seek opinion on this as I had just graduated from university and thus the interest rate of 4.75%pa had started since 1st March 2019.
Total education loan: sgd44000
Cash and investments through part time work: sgd32000
Annual income upcoming (secured a job and will start in 2 weeks) : est sgd73000 before cpf deductions.
Option 1: Pay sgd 32000 in full
Option 2: Continue to keep sgd 32000 in investments (mixture of reits/dividends stocks - expected returns 5-8%
Thank you!
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Gabriel Tham
25 Mar 2019
Tag Team Member at Kenichi Tag Team
My opinion is that it is better to pay off the loan asap. By paying off the loan, you are saving 4.75% p.a. Once the loan is gone, you have peace of mind to invest.
4.75% is a very high interest rate to compared to margin accounts for investments.
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This is a question that many students ask themselves. The answer depends on your personal situation and how much you can afford to pay each month.If you have just graduated from university and are unsure what you will be doing in the future, it may make sense to defer repaying your student loan until your first high-paying job is found. Galdly I have https://sopwritingservices.net/free-examples/ website to read free examples of essay and hire a writer for help in that essay.