Tuition Fee Loan – Financial advice

Recently, I met a friend named S. she complained about that after 3 years working in Singapore, she has managed to pay only half of tuition fee loan, which valued ~48 000SGD after her graduation.

She is a carefree person. She never cares about how much she spends each month. In a conversation, she revealed that she purchased an saving insurance plan. It promised to give her 6% annually interest rate. Given the fact that the TFL interested rate is 4.75%, she assumed to make a positive margin of 6%-4.75% = 1.25% interested rate.

I am shocking after listening her story. Tuition Fee Loan, a big sum of debt, was not addressed properly in my friend’s financial projection.

Firstly, tuition fee loan is a good loan for investment of degree. It is the prerequisite entry for many job in corporate companies. Those HR people, they look at academic performance and perhaps which school or degree . A loan sounds like good loan when it provide free interested rate. In fact as a student, I never think too much about it. If I don’t pay the interest, why I need to care.

Secondly, it is bad debt after graduation. There is interested rate, thing starts to change. I have to pay monthly instalment.  I have no way to escape from it. Imagine if you borrow money from a bank, you still have liability to make your business profitable and hopefully at the end of day, you are able to pay all. For TFL, it is a bit different. The interested rate may be not high, but it is accumulated over time. I have no way to escape from that. Even I leave Singapore to live in Vietnam, the bank will chase after me if I don’t pay the minimum monthly amount. Sounds fair enough?

In the case of losing money of building a business, I may declare bankrupt and that is it. For TFL, I have to pay back the loan until it is fulfilled. To another extent, TFL is the worst loan ever if you don’t realize its accumulating interest.

So that is reason why if you financial smart, you should never take bad debt into your long term calculation. You should quickly resolve the loan as soon as possible. Set the monthly instalment as high as you can adapt. Then after fully paying the loan, you can start invest into other saving or endowment plan. Basic insurance protection is fine, but saving plan should not be applied at the beginning. Otherwise, you may end up like my friend’s situation.

P/s: I am not a financial consultant. I just read “Rich dad poor dad” of Robert T. Kiyosaki. This book give me many financial advice.

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Gấu trúc

Mình mới đưa về dinh về 1 em gấu trúc. Vốn là heo nhưa đựng tiền xu để quyên góp cho dự án Cơm có thịt Singapore. Trông em ấy nửa giống gấu trúc, nửa giống chó. Thích cái vẻ đen trắng phong thuỷ của em ấy.

panda-front panda

 

 

Tuần sau hứng lên cũng đi vẽ cho dự án này của em Sunnie. Lấy mẫu là Superman. Thực ra mình cũng không phải hoạ sĩ. Chỉ bắt chước theo khuôn mẫu. Giờ là lúc đợi thiên hạ có ai rủ lòng thương adopt con piggy mình làm không.

our piggies

Sundown Marathon – Mission completed

photoYesterday is a memorable run.

It was my first 21 km. The event was Sundown Marathon Singapore.

It would be a smooth run, until I encounter an incident that caused my run late half an hour. When I come to the starting point at 12am, the place was filled with many people preparing for the 10km race.

For some reason, i have a strong belief that even though I start late, I could manage to finish before 4am, which is the cutoff time.

I run wildly into the crowd at the starting line. Someone told me that it was impossible to run 21 km now, the road is closed, only 10km is available.

I didn’t believe that. I moved forward. A quick glance on the left side, I saw an African guys, he wants to secure the fastest runner. I am not him, I come here to challenge myself, not the be the fastest.

I called for help and the security guys brought me to the Start Arc. He looks reluctantly. I assured one more time: “Let me run, I can catch up with my friends”. And they let me go.

An incredibly starting. Lonely. On the road. No people. Just follow the route.

10 minutes later, I saw a couple who were very tired, I guess the girl has not feeling well today.

Then I had no competitors on the route in the first half hour. What I did is I just need to surpass people at the last lines falling behind the race.

Running with friends is the motivation to cheer you up. I saw a group of people running together. One person blew his whistle, while others clapped their hands at regular interval to cheer up. I was inspired.

However, it is till an individual race. There is a proverb saying “Do not compare to others, compare to yourself.” The race is still my own race anyway.

I feel the joy of passing others. But I always remind that it is only the beginning of the race. After 1.5 hour, I will run among the average runners in the race. I change my strategy. Run slow and persistent. It was what I did in the later half of the run.

The last km: my legs have no feeling at all. Still, I could feel my ankle pain again.

Exhausted. I had already skipped a lot of water/100 plus on the way. Drinking a certain amount of water is good. But a lot of water is not advisable.

Then that is it. I completed 21.35 km in 2:55 minutes. Not bad. I can do it.