Repaying a student loan
Do you need to pay back your student loan? A repayment plan can make repaying a student loan simple and hassle-free.
Repaying a student loan can sometimes put you on the back foot before you’ve even stepped through the door of your first job… But by putting together a repayment plan from the get-go, you’ll be able to pay off your loan, hitting the career-ground running in no time.
When you will need to start repaying a student loan?
- While you may have originally applied for your loan with the assistance of a parent or guarantor, for surety reasons, the overall loan amount is in your name, and you’ll need to repay the loan through monthly instalments
- As a full-time student, you will start repaying the loan on completion of your studies. However, during your time of study, you will need to pay the monthly interest. The interest must be charged to your surety's bank account
- You will usually be given a grace period of three to six months before beginning to making your capital repayments if you have completed your articles, internship or community service
- This time can be extended if you still need to complete your CA(SA) articles, an internship or any community service
- You will need to start repaying your loan immediately if you fail to complete your studies
- As a part-time student, you will need to repay your loan as soon as you start studying
- Once you’ve made your first repayment, your instalments won’t change. (Part-time students might find their payments changing as they increase their loan annually.)
Planning for your repayments
- Draw up a budget as soon as you start earning a salary and include your monthly repayments in your fixed expenses
- Aim to pay back your loan as soon as possible as over time, loan interest rates can become excessive
- Understanding your loan’s structure and keeping track of your balance, charges and repayment status are vital. And while paying more than you owe every month is ideal, it isn’t always possible, so make sure you pay at least your minimum monthly amount to avoid your debt growing
- Consider Personal Loan Protection Plan (so you’re covered if you’re unable to continue working)
- And remember, if you don’t complete your studies but have a student loan, you’ll need to pay it back in full immediately.