YOUR
MONEY
SORTED
TERTIARY STUDIES:
HOW TO FUND THEM
E
VERY parent dreams of giving their children the
best education possible, equipping them with a
solid foundation to unlock future opportunities
and prosperity.
But the harsh reality is tertiary education
costs a small fortune. Fees are one thing – but
accommodation, books, travel, living expenses and study
aids such as laptops often need to be included too. And they
can blow the family budget.
Funding is often needed. Here are a few of the available
options.GETHELPHERE
BY LETITIA WATSON
Send suggestions for topics and requests for info to [email protected].
We may answer your questions in this column but won’t reply personally.TheNationalStudentFinancial
Aid Scheme (Nsfas) awards bur-
saries to students with academic
potential who don’t have the
funds to study.
General requirements for
application:
] You must be a South African
citizen.
] Your household’s total annual
income must be less than
R350 000.
] You must have completed
Grades 9 and 10 in order to
study at a technical and voca-
tional education and training
college, and have matric with ex-
emption to study at a university.HOW IT WORKS
A successful applicant is award-
ed a bursary that fully covers the
year’s study fees, as well as an al-
lowance for food, accommoda-tion,travelandpersonal items.
Nsfas directly contacts the in-
stitution where the student has
applied to establish how much
funding is needed.
The money for studies is paid
directly to the university or col-
lege. The student’s allowance for
living expenses is paid into a
bank account called the Nsfas
Wallet. Details can be found on
its website at nsfas.org.za.
The bursary is awarded on an
annual basis. The student needs
an average of at least 50% at the
end of the academic year to qual-
ify for the bursary the following
year. Nsfas awards bursaries for
degrees, diplomas or a qualifica-
tion only within the National
Qualifications Framework at a
university or college. Nsfas
doesn’t fund short courses or
studies at a private facility.1
GOVERNMENT FUNDING
Thisisa regularshort-term
loan from a bank or other credit
provider.
A personal loan is expensive
debt. The maximum interest
rate is the repo rate (6,5% at
present) plus 21% a year, so a
total of 27,5%.
The interest rate might be
lower than this if the applicant
has a good credit score and not
too much other debt.
If you go this route, apply
with various credit providers
and choose the one with the
lowest interest rate and fees
overthesameperiodandfor
thesameamount.
Ifthisisyouronlyoptionfor
studentfinance,besuretotake
outtheloanwitha creditpro-viderregistered with the Na-
tional Credit Regulator. This en-
sures there are legal limits to
the fees and interest charged.
General requirements for
application:
] A regular monthly income of,
for example, at least R2 000 a
month, depending on the loan
amount.
] You must be older than 18.
] ID, proof of residential address
and the past three months’ pay
slips or bank statements. If
you have no income you’ll have
to ask someone to take out the
loanforyou– butthey’llbe
100%responsibleforthere-
payments.You’llhavetocome
toa separatearrangementto
paythemback.3
PERSONAL LOANS
Theseloansareawardedfor
undergraduate and postgradu-
ate studies at public or private
facilities accredited by the
South African Qualifications
Authority.
Short courses also qualify
but there are usually conditions
such as the course must be at
least two months long.
General requirements for
application:
] You must be a South African
citi zen and earn more than a
certain monthly income – for
example R3 000 – a month.
] If you don’t earn an income – as
is often the case – a guarantor
(for example, a parent or guardi-
an) with full-time employment,
proof of income and a good
credit score takes out the loan
on your behalf.
] You’ll need proof you’ve been
accepted at a tertiary institution.HOWITWORKS
Student loan amounts vary. It’s
usually awarded on an annual
basis so if you’re continuing your
studies, you’ll usually have to
apply anew for the next year.
Generally, the interest on stu-
dent loans is lower than on other
debt. The specific interest rate
is calculated according to the
guarantor’s risk profile.
There are additional expens-
es, such as interest, services
fees, and insurance for the
guarantor and student in the
case of death or permanent dis-
ability. The guarantor is usually
responsible for paying these
expenses for the duration of
the study period.
Once the student graduates,
the loan becomes their respon-
sibility. If they drop out before
graduating, they have to start
repaying the loan immediately.2
STUDENT LOANS FROM A BANK
] Contact the institution you want to study at for information about
bursaries and other forms of finance. Some universities, for example,
offer merit bursaries.
] Find more information on student loans from banks’ websites.you.co.za 22 AUGUST 2019 | (^47)
YOU LIFESTYLE