Preface
Hello it's me again, here trying to get more views on my blog. I hope I have the motivation to continue posting here regularly xD. I managed to save $21k from Sep 2020 to Jul 2021 to repay my $25k CPF Education loan and below are the steps I took. This post is solely based on my own experiences and is not meant to serve as any professional advice since everyone's circumstances are different. Eh maybe I should invest in Grammarly if I earn more money HAHA
About CPF Education loan
My first mistake was not looking through the terms of the CPF loan carefully before starting uni, even though everything I'm supposed to know is stated here clearly. Please read the CPF loan FAQs properly before deciding which loan to take, and also to plan your finances carefully throughout the 3/4 years of your time studying.
CPF loan or MOE Tuition Fee Loan?
This question has been answered many times in websites such as here and here. But if you are feeling too lazy to read then you can look at this summary below.
| CPF loan | MOE Tuition Fee Loan | |
|---|---|---|
| Interest rate | 2.5% per annum, interest start accruing from first deduction | ~4.75% per annum, interests only start accruing one year after graduation |
| Guarantor | No need | Need but no income requirement |
| Max Repayment period | 12 years | 20 years |
| Loan amount | Up to 100% of tuition fees | Up to 90% of tuition fees |
Ya so I would have saved about $1000+ in interest if I had chosen the MOE tuition fee loan, plus the extension of the repayment and interest-free period due to Covid-19. Choose CPF loan only if you think that you are going to spend more than 4 years repaying the loan since the interest rate is lower.
When did I start saving?
I never thought much about my loan when I was in uni as I just assumed that it was interest-free, so I splurged most of my money going out with friends, and shopping online for things that I didn't need whenever I was in a bad mood.
I was left with a mere $2000 at the end of Y4S1, which made me reflect on how I have been spending my money. Since I won't have much time to meet with friends during internship, I decided to just stop going out and save intensively. My internship allowance was $900 for the first 3 months, and there was a pay-cut to $650 in the last 2 months due to covid-19.
| Expenditures | Income |
|---|---|
| Transport: $100 | Private Tuition: $665 |
| Food: $180 ($6 a day) | Internship allowance: $900 |
| Shopping: $200 | |
| Total expenditure: $480 | Total income: $1565 |
Graduation
The period between graduation and landing my traineeship was the most uncertain period ever. Since my internship was on private tutoring, I had no work experience in labs and I was too socially awkward to get a job in tuition centres. So I just randomly applied for jobs/traineeships without specific degree requirements between Jun and Aug 2020, where I saved an additional $2000+ in the 3 months from tutoring as I managed to get more tuition assignments after internship ended.
| Expenditures | Income |
|---|---|
| Transport: $30 | Private Tuition: $1000 |
| Food: $100 | |
| Shopping: $150 | |
| Total expenditure: $280 | Total income: $1000 |
Overall savings: $720 a month
Accumulated savings in Aug 2020: $9000+
Traineeship
From Sep to Dec 2020, my traineeship allowance was $1800 per month, plus my monthly income from tutoring was about $1000 on average, so I have a take-home income of about $2800 a month. I also spent more on transport since my student concession pass expired and I had to travel to my students' homes for tuition after CB ended, and more on shopping since I felt richer.
| Expenditures | Income |
|---|---|
| Transport: $110 | Private Tuition: $1000 |
| Food: $180 ($6 a day) | Traineeship allowance: $1800 |
| Shopping: $300 | |
| Parents: $360 | |
| Total: $950 | Total: $2800 |
A grand total of $25,421.22 lol, yes I encounter problems
Repayment Part 1 of 3
I panicked when I saw the amount of interest incurred and I kept thinking there must be a mistake with the calculations. That was when I started to read about this loan more carefully and I came to the conclusion that the only mistake here was my carelessness lololol. Luckily I have already saved $15,000 by Dec so I paid $10,000 to CPF to reduce the monthly interest(which was $42/month at that time). I also set up a GIRO arrangement with CPF where $238 would automatically be transferred to my mum's CPF account every month. I wasn't sure why was it $238 though...I forgot what happened when I applied for the GIRO.
My interest rate was also reduced to about $30 a month which was still quite high but better than $42. At that time, I decided to just focus on earning money until I can repay the loan, whatever side hobbies(such as blogging) can wait :p.
Repayment Part 2 of 3
This was my loan amount in Jun 2021, 6 months after my first repayment.
My income increased to about $3150 on average between Jan and Apr 2021, as I took on more tuition assignments which was really tiring and crazy of me. There was a period of time where I taught tuition for 6 days a week and I felt like dying HAHA.
| Expenditures | Income |
|---|---|
| Transport: $110 | Private Tuition: $1350 |
| Food: $180 ($6 a day) | Traineeship allowance: $1800 |
| Shopping: $400 | |
| Parents: $360 | |
| Repayment: $238 | |
| Total expenditure: $1288 | Total income: $3150 |
Repayment Part 3 of 3
This was taken from my laptop screen. And my savings dropped to $7000+.
