E
VERY parent dreams of giving their
children the best education possible,
equipping them with a solid founda-
tion to unlock future opportunity 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, need to be
included too, and they can blow the family
budget. Funding is often needed, so here are
threeoptions.GETHELPHERE
TheNationalStudentFinancial
AidScheme(NFSAS)awardsbur-
sariestostudentswithacademic
potentialwhodon’thavethe
fundstostudy.
Generalrequirementsfor
application:
Youmustbea SouthAfrican
citizen.
Yourhousehold’stotalannual
incomemustbelessthan
R350000.
You must have completed
Grade 9 and 10 in order to study
at a technical and vocational
educational and training (TVET)
college, and matric with exemp-
tion 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
allowance for food, accommoda-tion,travelandpersonal items.
NFSAS 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 NFSAS
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 next year’s bursary.
NSFAS awards bursaries for
degrees, diplomas or qualifica-
tions only within the National
Qualifications Framework (NQF)
at a university or college. NSFAS
doesn’t fund short courses or
studies at a private facility.1
GOVERNMENT FUNDING
Thisisa regularshort-termloan
from a bank or other credit pro-
vider.
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 different
credit providers and choose the
one with the lowest interest rate
and fees over the same period
and for the same amount.
If this is your only option for
student finance, be sure to take
out the loan with a credit provid-
er registered with the NationalCreditRegulator (NCR). This en-
sures there are legal limits to the
fees and interest charged.
Generalrequirementsfor
application:
A regular monthly income of,
for example, at least R2 000 a
month,dependingontheloan
amount.
Youmustbeolderthan18.
ID, proof of residential address
and the past three months’ pay
slips or bank statements.
If you have no income you
will have to ask someone to
take out the loan for you – but
they will be 100% responsible
for the repayments.
You will have to come to a
separate arrangement to pay
them back.3
PERSONAL LOANS
Theseloansareawardedfor
pre-andpostgraduatestudies
atpublicorprivateinstitutions
accreditedbytheSouthAfrican
QualificationsAuthority.Short
coursesalsoqualifybutthereare
usuallyconditions,suchasthe
coursemustbeatleasttwo
monthsinduration.
Generalrequirementsfor
application:
Youmustbea SouthAfrican
citizenandearnmorethana
certainmonthlyincome(for
exampleR3 000 a month).
Ifyoudon’tearnanincome– as
isoftenthecase– a guarantor
(forexample,a parentor
guardian)withfull-timeem-
ployment,proofofincomeand
a goodcreditscoretakesout
theloanonyourbehalf.
You’ll need proof that you have
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 have to apply again
for the next year.
Generally, the interest on stu-
dent loans is less than on other
debt, such as credit cards and
personal loans. The specific in-
terest rate is calculated accord-
ing to the guarantor’s risk profile.
There are additional expenses,
such as interest, services fees,
and insurance for the guarantor
and student in the case of death
or permanent disability. The guar-
antor is usually responsible for
paying these expenses for the
duration of the study period.
Once the student graduates,
the loan becomes their responsi-
bility. If they drop out before
graduating, they have to start
repaying the loan immediately.2
STUDENT LOANS FROM A BANK
HOW TO FUND
TERTIARY STUDIES
We explore a few options to help you pay for your higher education
YOUR
MONEY
SORTED
Contacttheinstitutionwhere you want to study for information about
bursariesandotherformsoffinance.Certainuniversities,forexample,
offermeritbursaries.
Find more information on student loans from banks’ websites.44 | 22 AUGUST 2019 http://www.drum.co.za
ADVICE BY LETITIA WATSON