Education loan or scholarship Expert busts myths

Education Loan or Scholarship? Expert Busts Myths

Contemplating the prospect of attending college is a thrilling juncture in a student’s life journey, but it is also accompanied by the challenge of determining how to finance their tertiary education. Although students and their families frequently turn to financial aid as a means of covering college tuition costs, it is important to note that this option is not without its drawbacks and should not be considered as a first resort. A more favorable alternative is scholarships, which can significantly relieve the financial burden of obtaining a college degree.
Scholarships are highly sought after and can provide substantial financial support to students throughout their college journey, particularly for those who demonstrate financial need and are pursuing full-ride scholarships. Despite their abundance, students must take the initiative to identify scholarships that align with their personal circumstances and goals. Unfortunately, many students do not even attempt to apply for scholarships due to various misconceptions surrounding this mode of financial aid.
Many students mistakenly believe they are not eligible for scholarships and miss out on potential opportunities. The truth is that there are countless scholarships available from universities worldwide, and not all are based on academic merit or high grades. As long as you meet the requirements, you can apply and potentially receive a scholarship.

‘Applying for scholarships is too hard’

Some students give up on applying for scholarships because they believe the process is complicated and time-consuming. While it’s true that obtaining a scholarship takes effort, many students waste time because they don’t use scholarship databases or don’t realise how easy it can be.
‘Only economically backward students get scholarships’

Not all scholarships are need-based. Many middle-income students win more scholarships than lower-income students. Some universities offer scholarships based on merit, not finances. If you meet the qualifications, you can receive a scholarship regardless of your financial situation.

‘Finding scholarships is difficult’
In the digital age, universities don’t always make it easy to find scholarship opportunities, leading many students to miss out on awards they’re eligible for. One way to stay informed is to subscribe to scholarship-related social media accounts, check university websites regularly, set up notifications, and keep an eye out for daily updates.

Preferring scholarships over education loans
While pursuing higher studies, most students will need to take out student loans to pay for fees, but that doesn’t mean mountains of student debt is inevitable. Smart students will be sure to do a free scholarship search to discover scholarship opportunities that help pay for tuition fees, so they don’t have to take out as many student loans. However, there’s more to scholarships than just paying for college tuition fees.

Let’s take a look at five reasons why scholarships are better than student loans:
i) The biggest difference between the two is apparent. Student loans are just like any other type of loan, and they must be paid back. On the other hand, scholarships are forever. A student might have less flexibility on how to spend them, but at least they won’t ever have to pay them back.

ii) Student loans may have origination fees and other charges that do not apply to scholarships.

iii) Loans may have negative consequences for borrowers who default or fail to make timely payments, while scholarships do not have these consequences.

iv) Education loans may be tax-deductible, while scholarships may be tax-free or taxable, depending on the circumstances.

v) Student loans may have income-driven repayment plans that allow borrowers to adjust their monthly payments based on their income, while scholarships do not have repayment plans.
When it comes to paying for college tuition fees and other expenses, scholarships are obviously the best bet. While scholarships may be free money, it isn’t possible to get it very easily. Applying for scholarships will take quite a bit of hard work and research. A candidate will have to invest a lot of time and effort into researching different scholarships, finding out the requirements, and applying before the various due dates. But if a candidate can put in the work, they will have a better chance of succeeding.

(The writer is the co-founder of Rostrum Education)

Courtesy : The Indian Express

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