If you are about to begin college and are wondering how you will pay for it, you’re not alone. Many college students rely on a combination of financial aid, scholarships, and student loans. However, navigating the entire process and securing enough funding can be overwhelming and a little difficult.
Unless you have a college fund, higher education can be a significant amount to cover each year. Short of winning the lottery or getting a full scholarship, student loans may be your only option to further your education. If you are debating taking out student loans, there are a few things to consider.
To help with your search for funding and get answers to your questions, it is always best to do some research. Looking at a site like TuitionHero can help you break down all of the information related to everything student loans. Coupled with your research, there are a few points that might be helpful when weighing student loan options. Let’s take a look at some advice for getting student loans.
Look for financial aid and federal loan programs.
Before seeking student loans, you should first try to qualify for any financial aid programs. Grants, scholarships, and work-study funds are available to help you reduce the overall cost of college tuition. To qualify for financial assistance, you will need to submit the Free Application for Federal Student Aid or FAFSA. This will give you a complete picture of any assistance you may qualify for.
Once you have applied for financial aid, you might need to consider student loans to cover excess costs and tuition. Federal and private loans are the two main types of funding available for students. As part of your FAFSA results, you will be offered a federal loan program that you qualify for. You should always try to get federal loans first. Federal programs have easier repayment terms and more forgiveness programs compared to private loans. Additionally, federal loans usually offer much lower interest rates.
Try to get ahead while you’re still in school.
One thing that some students try to do is make payments on student loans before they graduate. Almost every checking account will allow you to set up automatic payments. If you can set up payments to your loan provider, you can use the excess to help chip away at your balance before you ever graduate. Additionally, you might transfer any excess to a high-interest savings account and let the money earn a little interest while in college. Once you graduate, you can use the money in your savings to pay off some of your debt.
The majority of federal loan programs don’t accrue any interest while you are in college and provide a six-month grace period once you graduate. For the 2019-2020 school year, students and their families paid an average of $21,950 for in-state tuition. Trying to pay off some of your loans while in school or soon after graduation will cut down on your principal balance and decrease the amount of interest you have to pay over time.
Finish what you started.
If you decide to go to college or graduate school with a student loan, you should persevere to complete your degree. It is estimated that about a third of people who attend college will stop before finishing the program. However, not finishing could prove to be very costly. Without completing your degree or certificate program, you will miss out on the financial benefits of having a diploma. You might face significant repayment terms and not have the income to do so depending on how much you borrow.
An investment in a college degree can be significant. However, with sites like Tuition Hero, you can set yourself up for success and see the best return on your money.