Many Germans would take out a loan to advance their careers: Loans to finance training and postgraduate courses are often the only way for professionals to obtain a formal education. There are enough special financing offers – but not all are a good deal.
In a representative study in the fall, Credit Bankive surveyed 1,000 people about their career aspirations and possible obstacles to their realization. 83 percent of respondents said that they wanted to improve their job opportunities. After all, 46 percent would be willing to take out loans for language courses, further education or stays abroad.
Is an education loan worthwhile?
Education never hurts whether an educational loan, however, always pays off purely economically, is uncertain. Borrowers can seldom even estimate the impact of credit-financed education on their own career success. Even in retrospect, this often makes it difficult to separate it from other career factors (length of service, work experience, etc.).
One of the first points of contact in search of educational loans is the state-owned Intrasavings. However, this only favors low-interest loans under certain conditions, which either serve to finance tuition fees or to cover livelihoods. Further education outside of formal education is not supported: Language courses, PC trainings, courses for executives, rhetoric seminars, etc. must be paid out of pocket or financed by a bank loan.
Education funding not only from the state
For one-off, extra occupational training without loss of income, a classic installment credit may be available to cover the fees incurred. Long-term educational measures with (partial) income loss are eligible for special student loans offered by several private banks. In contrast to installment loans, payments are made monthly here. The repayment can usually be extended over a longer period of time.
For loans with a longer maturity, borrowers should be sure to pay as much interest as possible. For some student loans, the interest for the repayment phase is only determined when it starts. The interest rates used in example calculations could therefore turn out to be drastically too low in a few years: If the interest rate rises noticeably from its historically low level, the credit rate can easily be 30 to 50 percent higher than today’s figures.