How to Minimize Student Loans
To be fair, you only have so much control over how early you start. Parents can begin a 529 plan and have 18 years to build up tax-advantaged savings so their children are prepared to face the financial requirements of higher education. If you’re just starting high school and don’t have anything in the bank, the 529 plan is still an option, you just won’t have as much opportunity to grow what you’re saving.
If you save $200 a month for 10 years at 6.8 percent, you’ll have $34,433 to pay for college. If instead, you borrow that $34,433 for college, you’ll end up paying $396 per month if you repay it over that same 10 years. Save money for college early so you can avoid extra interest.
Being able to balance college courses and a job will help offset the cost of tuition and books. At a certain point, you can find a job that might turn into an entry-level foot in the door to your new career. Some colleges and universities allow you to pay your tuition in installments over the course of the semester and school year, giving you more flexibility in working your way through school. College Fund If you are taking out student loans, they don’t come due until you’re finished with school. Taking a reasonable amount of time to go to class while working, can provide you the time you need to save and be able to pay off a large chunk of loans right off the bat.
Sit down and see just how long you want to be in school, the fewer wasted classes, the quicker you’re finished and the less you’re borrowing. A summer class each year can knock your graduating time down or remember that at some universities between 12 and 18 credit hours cost the same in terms of tuition. If you don’t know what you will be majoring in, think of getting generals out of the way at community college or less expensive school and then transferring when you know what you want to study.
Scholarships, unlike loans, don’t have to be paid back. Many different organizations, both on campus and in the community, offer scholarships to college students for a variety of reasons. Do your research and apply for as many as you can. Government grants are also a source of money for college, but are usually given to those with financial needs. Any money you receive is money you don’t have to borrow and pay interest on.
Find the best schools for the money or find the cheaper schools that offer the program you want. Include cost as part of your enrollment decision and weigh its pros and cons. Find schools that are looking for students like you and would be willing to help you financially.
Make sure you budget and live according to your budget. Piling credit card debt on top of student loans can make a tight situation even worse.
If at all possible, treat student loans as a last resort. Use student loans to pay only student expenses. Make sure and take out government loans first so you have the added protection and lower interest rate they provide. Don’t use them as lifestyle loans or to buy things you don’t need. If you can afford your living expenses without needing the extra help then find a way to live within your means and only borrow what you need to pay tuition, books and any other fees.