Student loan: The word itself defines a loan taken to sponsor your studies.

Student Loan
Photo by Roman Synkevych on Unsplash

Higher studies can be very hard to finance. Some people actually drop out of their institutions due to a lack of funding. Although there are many deserving scholarships in various educational institutions, it can be difficult to find and sustain one.

Hence, student loan helps you to delay your funding problems and encourage you on your sole path to your degree. Some might decide to pursue online degrees for lower costs. Since we’re all not some big shot millionaire, it is very common for one to take up a few thousand bucks than to swell over not being able to pay for your dream curriculum.

How Does it Work?

If one has ever done their finances or bank paperwork, student loans work exactly how every other loan work. Some banks have made it easier for students to achieve this with comparatively low-interest rates (loan rates) and easier leverage.

Once you’re 18, you can easily plan your payment methods according to what you are going to earn in the next couple of years. Most students plan to pay this part of their source after they graduate; when they actually start earning.

5 Pros of Student Loan

1. Ease With Everything

While it can be very hard to sustain both your semester fees and your living expenses, student loan steps in and take care of one wheel in your cart so that you can focus on your studies and lifestyle.

2. Ease of Access

Many banking organizations encourage students to take loans; not as a part of their schemes but as a part of students’ economic plans. A proper plan and a mortgage can get you an easy loan and there is no risk of you losing values of your possessions. This also creates a strong motivation for why and what you’re working on.

3. Avoids the Threat of Running out of Bread

Busting years of savings on colleges can be risky but with these loans, you can slowly be paying for your studies while maintaining your savings for any future causes. Perse, if any natural disaster or a health hazard sweeps your world under you; you always need a plan of action, a backup and student loan serves so.

4. Helps you Build up Credits

International and nationwide banking systems have a credit score to show how much of your affordability and creditability in the past have built up. Put into simple words: trust scores. However, you require no credit score to take a student loan and since this is going to be one of your first financial histories, you can keep up your payments on time and maintain a good credit score for future references.

5. Takes Care of Yourself

While every one of us believes in our own financial freedom, achieving this at the age of 18 has very slim probabilities. Unless of course, you’re a big prodigy in money earning or a bitcoin master. The flexibility of a student loan can provide lets you steam off some pressure of your upcoming hectic years.

But is managing money at such a young age really worth it? Should you really be taking that debt so early on before you actually realize you can pay up the whole thing later on?

4 Cons of Student Loan

1. Crippling Anxiety

If you are going to take up money to finance yourself, you should be willing enough to plan your way to get out of the debt. Some people find this very treacherous; having constant anxiety of money on your hands slipping away as soon as you start earning. So, unless one is not strategic, it is not unusual for students to have the fear of paying all of their students’ debt on their own.

2. Not a Long Term Solution

Remember that student loan is just a way of delaying the inevitable. Sooner or later, you are going to pay your student fees. This doesn’t mean you shouldn’t be joining an institution just because you have to pay eventually. It’s just that you make the most out of your graduation so that you aren’t plunging into debts.

3. Scams and Schemes

If you’re not careful enough and in desperate need of money, there are many agents and “maybe illegal” organization that promises low interest rates and have their own shenanigan schemes. It is very important that you do not get into any of these and only go through a trusted financial institution and know all of their terms and condition.

4. Risk of Not Being Able to Repay

Taking and paying loans is like playing with a double-edged sword. You might either get a good credit score or mess it up. Sometimes there are bad weeks or possible bad months; you might have low pays or high expenses. Delaying your loan payments can keep you in a bad spot and hurt your credit scores.


Student loans have been there before you even started schooling and by far, has been one of the best strategies to financing yourself for higher studies. While there are market risks and people going into debt, no one should doubt their own capabilities.

Once you end up with a proper degree, everything seems “worth it”. All it takes is you to be careful, strategic and researchful and you should be fine getting on your way to your dream degree and hopefully that dream job or your very own enterprise.