For many students, education loans are the first major financial decision of their lives. These loans make higher studies possible when family savings fall short. But what often seems like “easy money” can turn into a long-term burden if not handled wisely.
Student loans come with responsibilities. Every rupee you borrow today will need to be repaid later, often with interest. Many students take the maximum amount offered without calculating how much they’ll actually need. This can lead to higher debt after graduation.
The biggest pitfall is not understanding interest. Even a small difference in the interest rate can make a big change in the total amount you repay. A loan of ₹5 lakh with a 10% interest will become almost ₹8 lakh at the time it is fully paid off.
Another common mistake is delaying repayment without a plan. Many students wait too long or assume their future job will easily cover EMIs. But life after studies can be unpredictable. It may take a lot of time to find jobs or the salaries may be lower than expected. This can make the debt feel heavier and stressful.
Borrowing smart means comparing different banks and government schemes before choosing. The Indian government offers education loan subsidies and repayment support through schemes like the Central Sector Interest Subsidy Scheme (CSIS) for economically weaker students. Using such options can reduce the total cost of the loan.