Education is one of the most vital and necessary tools that help an individual become successful in their career and allow them to learn new and complex concepts that they would not otherwise be exposed to. While quality education is necessary for a person’s growth, the cost of education at premiere institutes is usually quite high, and for students who do come not come from strong financial backgrounds, it can be difficult to pay such high fees.
This is especially applicable for students planning to study in universities abroad, as the college fees and living costs can easily run into tens of lakhs. Fortunately, most banks and financial institutions offer education loans to promising students interested in pursuing higher studies so they can achieve the careers they desire. However, taking an education loan is a major financial decision that must be carefully assessed. An education loan EMI calculator can be incredibly useful in helping you assess whether going for an education loan is the right choice.
An education loan calculator is an online tool that you can use to determine exactly how much EMI you will have to pay for your required education loan, as well as how much money you will have to pay as interest on your education loan. In order to determine these figures, all you need to do is enter the necessary details like how much money you need in the form of your education loan, the interest rate offered by the bank/financial institution as well as the tenure or the time period of your loan. Student loans allow students to attain the highest levels of education that they could not afford otherwise.
Using an education loan calculator helps you in the following.
1. An online education loan calculator will help you understand the real cost of taking the loan with interest included, as well as how much you will have to pay in the form of monthly EMIs.
2. It helps save time by allowing you to get all the accurate details about the loans without spending your valuable hours doing these interest and EMI calculations manually, which can take up a significant block of your time.
3. The results showcased by the education loan calculator are highly accurate since they are based on a precise formula and the calculations are carried out digitally.
The following formula is used in the education loan calculator to determine the figures about EMI and interest payments:
EMI = [P*R*(1+R)^n]/[(1+R)^n-1]
In this formula,
P = Principal amount
R = The rate of interest
n = Tenure or time period of the loan
Considering an example, student ‘A’ takes out a student loan of ₹10 lakh, at an interest rate of 10% and a tenure of 4 years, then using the formula, the monthly EMI for the student would come out to ₹26,363 and the total interest to be paid over the course of the loan tenure would be ₹2,17,404. This would effectively bring the total cost of loan repayment at a total of ₹12,17,404.
Using the student loan EMI calculator is extremely simple, just follow the steps given below:
Step 1: Enter the amount of money that you wish to borrow in the form of the total loan amount in the student loan repayment calculator.
Step 2: Enter the rate of interest charged by the bank or financial institution.
Step 3: Enter the tenure or the total duration of the loan repayment
The education loan calculator will show you the exact amount you need to pay as monthly EMIs along with the total interest that you will have to pay over the course of the loan repayment.