It’s a little scary when you first think of the fact that you have to begin your educational journey with debt. But college is almost mandatory today if you’re looking to land a well-paying gig. Almost every employer demands a degree, and even if you’re planning to go into business for yourself, college offers you four years of experience that you cannot afford to miss. But you need money for a degree, and unless you have access to a scholarship or a fund that your parents have set up for you, you need to take out a loan.
The downside to a loan is that you have to pay it back, and this puts pressure on you to find a job that pays well as soon as you leave college or you have to consider student loan consolidation to make sense of your financial situation.
So if you’re smart, you’ll try to keep your student to a minimum so that your future financial burden does not become too heavy a cross to bear.
Here are a few tips to help you minimize your student loans…
1. Apply for scholarships: Even if you don’t secure one in your first year, you do have opportunities in your second and third years if your grades are good. The key is to keep looking and applying.
2. Start saving: It’s not an easy thing to do, but if you’re the kind who plans ahead, you could start saving for college while still in school. Your savings may not amount to much, but money is still money, especially when it means you reduce your future burden of debt.
3. Take a year off to earn money: If you’re able to get a job even without a degree, you could use a year after high school to save up for college instead of taking out a loan.
4. Study online: It’s a cheaper way to earn a degree and one option that allows you to continue working as well. So you are saved the hassle of borrowing to finance your education.
5. Seek help from loved ones: Very often, monetary gifts from loved ones go a long way in helping to keep your debt down. Tell your friends and family that you are saving up for college and ask them to contribute what they can towards your endeavor.
6. Reduce your expenditure: Keep your expenses down in college – remember that every dollar that you don’t spend today is one that you don’t have to repay with interest in the future.
7. Get a job: It may be hard to manage a job and your studies, but a part time job helps you earn money for your expenses instead of having to use your loan money for the same.
8. Minimize usage of your credit card: It may seem like easy money, but when it’s time for the bill to be paid, you’re going to find yourself in a quandary. And the longer you defer paying your balance, the higher the amount becomes. So the best thing to do is to use your credit card only in emergencies and then pay off your bill at the earliest.
9. Don’t borrow or lend money: They may be your best friends, but when it comes to money, it’s each to his/her own. So don’t borrow money or lend any to anyone, even if it’s just a few dollars. Money has a way of ruining relationships like nothing else, and if you become a habitual borrower, you know there is no end to it.
10.Maintain good grades: One way to ensure that you get a good job on graduation or even before that is to maintain good grades. Employers are always on the lookout for successful achievers in the academic and extracurricular departments.
This guest article was written by Adrienne Carlson.
4 thoughts on “10 Tips to Minimize Your Student Loan”
These are great tips — I’d add that one should be realistic about the college you attend. There is nothing wrong with attending an expensive college if you (or parents/family) can pay for it, or your career has a very good chance of being able to pay off loans without strife. But it is naive to not consider costs at all if you are on your own and pursing a lower paying career.
I agree with both of you. Future earnings must be a deciding factor when deciding on your future education/student loan situation. If you know you have the opportunity, ambition, and work ethic to make lots of money in your given field then go for it. If you’re in school simply killing time it may not be the greatest idea to acquire lots of debt to earn your degree.
All I will say is that an expensive degree is nice, but you must know why you want it.
I think that if something takes away from your studies, you should just stick with a student loan. For example I know a few people who keep taking time off to work because they are afraid of the debt but if they had gotten through school with a debt they would be doing much better financial now even taking into account the debt. This is less true if someone is going to school for a less lucrative education (social work or the like).
Having received an expensive and impractical degree in creative writing, I can safely say that such an education would not be worth a large debt. I was fortunate enough to have most of my school paid for by family, but after graduating I’ve struggled to make decent wages, and now I find myself going back to class studying a more practical post-graduate topic (veterinary sciences) in the hopes of making a better living. This time around, there will be sizeable debt, so I need to be sure I’m ready to pay it off when the time comes. Hopefully the “more employable” degree will help in that regard.