Managing Student Loans

For most students in today’s world student loans are a standard part of the college experience. Anyone telling you otherwise is either one of the few on a full athletic/academic scholarship or with parents paying their way. Neither of these options are wrong and if you have their chances you should embrace them and be extremely thankful.

I can’t give much advice on avoiding student loans, because they are inevitable for 90% of us in college. Don’t let them worry you, because sometimes the numbers end up being so high if you dwell on them it will make you very uneasy. There are a few tips though for maximizing the funds you do get for your education and cutting some debt down before it starts:

1.) Don’t get a credit card or delay doing so as long as possible. I recently got my first one at the age of 23 and used it for 2 purchases over 200 dollars each. I have 0% interest for 12 months and intend on paying that balance off well before the time is up for 0% interest. If you do get a credit card don’t use it loosely or use it for big ticket items. Use it only if your 100% positive you can pay it off quickly, you want to be able to pay down at least 50% of your credit card balance each month if interest is adding up. The average college student is 15,000 in debt due to credit cards alone; don’t fall for all the college deals and gimmicks. If you must have one, choose one based on finances, not on flashy deals and cool offers.

2.) Apply for FAFSA which is a free form you fill out from the US government. This form is sent yearly to your college and based on that information both the government and school decides how much aid to give you. That said the first college I attended gave me over 45 thousand dollars in grants (which did not have to be paid back). Grants are a godsend, but you’ll get zero if you don’t complete this form.

3.) Don’t use a credit card or bank to pay the college bills. Use a company that specializes in student loans such as Sallie Mae or AES. These companies have more lenient ways of dealing with inability to pay, deferment, and most importantly lower interest rates then banks and credit cards ever will. They also help you set up very low interest government loans called Stafford Loans.

4.) For most colleges, its useless working too often to try to keep up with the college bills. The price of education is skyrocketing; the best you should hope to do is save money for books, food, and other outside expenses. Trying to work a few jobs during school may work for some going to state schools or community colleges; but with many schools easily breaking the 30 thousand dollar mark for a year of tuition; you are far better off working a little and focusing on your studies so your investment pays off.

From a college student closing in on the 100k mark in loans and probably facing more down the line due to grad school; don’t worry and don’t fret. You can ensure that the only debt you have is due to advancing your education; an investment well worth it. Working 40hours a week while taking a full course load only works for some, if you fail out of college thats alot of wasted time and money. Make your education a priority and you’ll find the way to pay for it.