This video will give an approximate idea of the range of time required to pay back the education loan taken in India for study abroad. The use case used here is of the Netherlands for study, living while the same logic can be adapted to other European countries, USA or any other study abroad destinations. Also, the use case here takes an example of a simple scheme to payback loan after the moratorium period after studies abroad from a Government bank in India. The main components that will change are the study, living expenses, salary and savings. This calculation is also obviously dependent on the terms and conditions, interest rate, flexibility offered by the financial institution or bank!
What are the study, living and other expenses?
Approximately 45 Lakhs without any funding based on the current Euro rates. These expenses include study and living expenses without any funding, scholarships or financial assistance. Check the cost of study and living video to know more!
What is the education loan amount and interest rate to be repayed in India?
Suppose loan amount is 30 Lakhs Indian Rupees (taking on the max side, might be less also). Taking the popular Govt. bank of India, SBI rates for an education loan on 28th August 2021, which is 9.30%on SBI website, we will calculate the EMI as follows.
What is the average salary?
Around 2200-2500 Euros in hand per month after taxes if PhD otherwise it will be on the higher side around 2300-2700 Eur without work experience and bit higher with work experience. Check my salary video.
What is the average savings?
Easily more than 50% of the earnings for a single person per month, check my savings video to get a detailed idea on the breakdown! If we take the worst case scenario of least earnings per month of 2200 Euros and the least savings of 50% per month then the least savings per month will be 1100 Euros.
Total time to payback the loan? EMI Calculator?
Depends a lot on the flexibility, terms and conditions and interest rate of the lending bank or institution. SBI EMI Calculator (This link is accessed on 28th August 2021) 30 lakhs, 3 years payback period after the study (or moratarium period), 9.30% p.a. then EMI (Easy Monthly Installments) will be around 95819 INR or 1105 Eur per month at the current rate conversion rate on 28th August 2021. The following screenshot shows a sample EMI calculation using this calculator.
The YouTube video on this: