How to Manage Currency Fluctuation on Your Study Abroad Loan Repayments

How to Manage Currency Fluctuation on Your Study Abroad Loan Repayments: Traveling to foreign lands for higher education is a dream destination for every student. While the exchange rates on your monthly emi payment keeps changing, if you are paying your loan in a foreign currency; it may lead to an increased or decreased repayment in comparison to the initial amount. It can be confusing and could disturb the regular budget. So, to make the situation easier for you, it is essential to understand how to manage currency fluctuation on your study abroad loan repayments.

Acadfly helps you simplify this problem with its forex facility, which can provide its services in a prepaid forex card and at favorable rates. This will help the student safely meet their foreign payments, keep the budget in control, and educate them regarding currency conversion and thus, repayments become easier.

Currency Fluctuation 

Currency fluctuation is the change in value between one currency and another. For example, if you take an education loan in Indian rupees (INR) and pay the loan EMIs while you are studying in the United States, then your EMI amount will be subject to the USD and INR exchange rate. Therefore, when the rupee falls in value, your repayment amount in INR will go up. Whereas, if the rupee increases in value, then your repayment amount in INR will go down. The following are the factors that contribute to currency fluctuation:

• Global Economic Conditions: Inflation, interest rates, and trade balances can have a significant impact on exchange rates.

• Political Stability: Elections, policies, and international relations can also lead to a sudden change in exchange rates.

• Market Speculation: Traders who buy and sell currencies can rapidly change the value of the currency in the market.

When a student is well aware of these factors, they can anticipate these fluctuations and plan their education loan repayment accordingly.

Manage Currency Risk on Study Abroad Loan 

There are some effective strategies to how to manage currency fluctuation on your study abroad loan repayments are:

• Pick the correct loan currency: If the lender provides the loan in multiple currencies, choose the one that is more stable or if it is similar to what you are expected to earn while abroad.

• Hedge your loan: Foreign exchange hedging for education loan can protect you from sudden changes in the exchange rate. Use forward contracts or currency options that will let you lock in a rate for the future period.

• Smart repayment: Monitor the currency exchange rate, and if you can repay your loan while the rate is in your favor, do so. It will reduce the overall repayment burden. Avoid making repayments during volatile times. 

• Diversify your payment methods: Split your repayments into multiple modes of payment like bank transfers, forex cards, and digital wallets. It will help you to lower the risk associated with a single payment method.

• Use the Acadfly Forex service: Acadfly provides prepaid forex cards and easy currency exchange services. You can use them to make international payments with ease, good rates, and without paying any hidden or extra fees. It is the best way to keep a tab on your budget.

Use of above methods can help you minimize the impact of currency fluctuations on your repayment plans and will let you plan better.

How to Reduce Education Loan EMI After Working Abroad

A lot of students prefer to work after their education program is over, to pay off their loan. It’s possible that even after you start working, your repayments may be affected by exchange rates. Thus you may want to know how to reduce education loan EMI after working abroad:

• Currency conversions: You can work on converting your salary at a time when the foreign currency is strong and your home currency is weak. It will help you to pay a lower EMI amount to your home country.

• Increasing your EMI: While you are working abroad, make sure that you pay a little extra when the foreign currency is performing well in comparison to your home currency. This will help you reduce the total loan burden.

• Prepaid Forex Cards: A prepaid forex card will help you in easy and safe money transfers. Additionally, it will also give you budget control and currency exchange guidance while you are paying your EMIs.

• Loan Restructuring: You can also approach your loan lender and request for a restructuring of your loan based on the income that you are earning while you are working abroad. The lender may also give you a flexible EMI repayment plan.

• Budget Planning: You should carefully plan your budget and compare the current currency trends before making any payment. This way, you can save a significant amount by just rescheduling your repayments a little here and there.

Therefore, combining all the methods above can help you reduce the burden of currency fluctuation on your EMIs and help you to repay it faster.

Monitoring Exchange Rates 

Currency exchange rate should also be a significant part of how to manage currency fluctuation on your study abroad loan repayments.

• Online tools and Apps: There are websites and apps which show the real-time currency rates and can also alert you when the rates are in your favor.

• Alerts: You can also set alerts for the currency conversion so that you can get notified when the exchange rate drops to a level where it is cheaper for you to make the repayment.

• Regular Review: Keep reviewing your currency exchange rates before you make a repayment. It will help you in avoiding any unforeseen hike in your EMI.

Acadfly also helps you with insights on current currency trends and the exchange rate. So that you can easily plan your repayments and not worry about them.

Financial Planning for International Students

The following financial planning tips will also help in how to manage currency fluctuation on your study abroad loan repayments:

• Budget: You should always create a monthly budget which includes the loan repayment as one of your regular expenses and the currency fluctuation as well.

• Emergency Funds: Make sure you save some extra money, an emergency fund which can be used to meet repayments in case the currency fluctuation goes against you.

• Financial Advisor: You can also take advice from financial advisors or make use of services like Acadfly to know the currency trends and to help you with planning your repayments.

• Keep track: Keep a record of all the payments that you make and the currency conversion details for clarity of your records.

Following these smart financial planning tips, you will be able to prepare yourself for any exchange rate changes that may take place during your repayment period and help you to repay your loans without any financial stress.

Role of Acadfly in Managing Forex 

Acadfly provides a convenient way for foreign exchange to the students who are traveling abroad for their higher studies. Their services include: 

• Prepaid Forex Cards: Safe and easy to use for international payments.

• Favorable Exchange Rates: Ensures students get the best value for money while making repayments or in managing their living expenses.

• Currency Conversion Guidance: Helps students understand the currency conversion rates better and thus reduce their unnecessary losses.

• Budget Control Assistance: Helps students to keep their repayments in line with the budget that they have planned.

Therefore, by making use of Acadfly, students can easily understand how to manage currency fluctuation on your study abroad loan repayments, thus, making the entire process easy and stress-free.