When Car Loans are cheaper than Education Loans….

No no, I have not gone wonky…

I am still the same, slightly silly, slightly off the track, slightly philosophical and slightly…well….may be wonky. What to do, I am what I am…

Enough about me, read on…

There is an old saying….it goes something like this…

Give a man a fish and you feed him for a day. Teach a man to fish and you feed him for a lifetime

Let me paraphrase it for the benefit of this article and to make my point….

Give a man some easy money and he will enjoy it till money lasts, teach a man how to make money and he will enjoy a lifetime….

I am sure, my dear readers, you will agree that the shortest, cleanest and best path to make a man self-sufficient, financially and otherwise, is to get him solid education.

Now, let’s face it, in the modern world education costs money, especially tertiary education which enables a person to develop skills and knowledge which enables him to make money and earn a decent living.

Let’s also face it that, in countries like India, there is so much poverty (still) and “good” tertiary education is so expensive that a lower middle and poor class (still the majority of India) cannot afford to send their kids for good quality Tertiary education. The uncontrolled growth of private educational institutions has made the situation worst.

So, what do you do if either your child is brilliant or you want to get them higher education so that he/she can lead the family out of the circle of poverty….

Unfortunately, there is only one major option….take a loan.

Have you ever tried doing that or have you known any person who tried doing that….

The number of criteria, the number of requirements, the number of documents, and the number of securities that one has to produce is like nobody’s business. And then on top of it, even if the bank agrees to give you a loan, the interest rates/EMI are killing.

Now, compare the education loan to getting a car loan, low-interest rate, very low or close to zero down payment, few years income tax records, an earning statement (of a much lower value) and voila….you have the loan….

Imagine, knowingly, we are feeding fish to men and not making our best efforts to teach him how to fish…

And all the above is happening in the know of the Government and RBI.

Sad isn’t it…

So, one day I decided to talk to my banker friends to understand why? I got a unanimous answer…

The default rate in Education Loans is high. Not because the student runs away but more so because many of them don’t get jobs which enable them to pay the EMI and over and above allows them to live a comfortable life.

Valid Financial Logic.

However, this, in my opinion, is not just a financial issue. This is a social and developmental issue.

Our Govt. comes up with zillions of welfare schemes, they subsidize agriculture, cooking gas, they make cheap housing (and the list goes on), they even write-off loans but all these are nothing more than giving fish to the hungry.

Education, on the other hand, teaches people how to fish but, for some reason, Govts. don’t care….

They will not make banks subsidise, give low-interest benefits, write off loans why? Because it is not a vote catcher.

The bane of democracy is that everything is about the next elections….

Also, I guess the other reason is that the fear politicians have that if most of the population gets educated they will start asking questions and demanding their rights…something no politician wants to be on the receiving end of.

In short, giving fish helps in the next elections, teaching how to catch doesn’t…

Sad……but true….

Till a time comes when the situation is reversed, we have to reconcile ourselves to the fact that…

The Car Loans will be cheaper than Education Loans….

As always, please do give your thoughts and comments and if you like this article, please do like, share and subscribe to my blog…

Until next time, stay safe…

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We live in a society which keeps scores

Sad but true….but let me first explain what I mean with that….

Recall any time you were sitting with your friends, relatives, close family members….also recall what was the main conversation around…..let me help you by giving thought prompters…

Do words/sentences like these ring a bell, his son has done………, her sister is doing very well she is…….., her uncle is a …….., they have gone to ……. for vacation, even at this young age he ………,

I can possible go on and on and the list will not end….

Have we ever wondered what effect this is having on the psyche of our people, kids, young ones, other human beings……!!

And then we crib about, how competitive getting admission into nursery, primary school, professional colleges has become, life has become too stressful (leading to diseases at young ages), people cutting corners behaving in a non-ethical manner to achieve what they want to achieve, youngsters are getting hooked on to drugs, students committing suicide, people working themselves off to buy a bigger car, more houses, trying to go on bigger and more money blowing vacations…..the list goes on and on and on….!!!

Bottom line……my SCORE must become bigger than yours, my son should do MORE……than others, my SISTER should be bigger than others, my family should go on a MORE ostentatious vacation than others, my son’s marriage should be even more flashy than others,

and this one is the most ridiculous one I have ever heard,

my husband got his piles surgery done in England (I don’t trust Indian hospitals…. :-))

…..and blah blah blah….

Do we need such a society? Do we need such people, do we really think we, the great Homo Sapiens, are the most intelligent of beings!!!!

DO WE REALLY WANT TO KEEP A SCORE…!!! ALWAYS….from the time we are born to the day we die…….

And even if we have to can we please keep scores like my son is happier than…….my brother is so satisfied with life that…..my sister is such a good person that she……..

Think about it…

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