How much should you borrow to pay for college? Here are three tips to minimize your loan.
Borrowing to pay for education has become the norm in the last decade, with students expecting to take on tens of thousands of dollars in loans to pay for college. It has reached the point where the alternatives to getting a loan aren’t often considered. But then, rather than expecting young adults to take on debt, we should rather be educating them about the benefits and alternatives to taking out a student loan.
Before applying for a student loan, several options should be considered first. The first step to take is to budget how much you’ll need to pay for your tuition and living costs. Once you have this figured out, you can use a student loan calculator like https://www.elfi.com/student-loan-calculator/ to find out how much you’ll expect to pay each month, depending on the interest rates and the payment terms. When you have this figured out, you can start to look at other options to help subsidize your student loan.
Financial aid and scholarships
The first thing to look into is any option for financial assistance that you may be able to apply for. There are many ways to apply for scholarships, so look at what’s available in your local community and your school, and see what companies and industry bodies provide scholarships to students. The sooner you start applying, the better, and the more options you apply for mean that you stand a better chance of being accepted. Getting a job is one of the best ways to do this, because if you can get a part-time job in a reasonably-sized company, you may be able to get additional support toward your college classes.
Budgeting for college
If you’re about to start college, then now is the time to start budgeting. The first step is to find out what your outgoing weekly and monthly costs are. This will include things like travel, food, and any social activities you want to attend. Your living costs like rent and bills will be one of your biggest outgoings, so make sure to take these into account, too. Once you have these, you can start to work out what your incoming cash looks like compared to your outgoings. You want to make sure you can live comfortably, but also make sure not to stretch yourself too thin either. By making sure that you spend within your means while you’re at college, this will stop you from needing to take out any additional loans or credit cards, which can have much higher interest rates.
Finding a job
One of the best ways to offset and control your student loan is to get a job. If you can start earning and saving before you go to college, this will mean you don’t have to borrow as much when you’re there. Also, if you work while studying at the same time, you can pay for your day-to-day expenses.
