Education loans are a great resource for coping with high college costs. Before borrowing student loans, there are several questions you'll want to answer before deciding how much to borrow. Knowing actual costs, available financial aid programs and student loans and how much you can afford to borrow will help you decide how much to borrow.
What Does College Really Cost?
Tuition and admission fees are typically the largest component of college costs, but don't forget about books, technology and media needed for completing your coursework. Check your college catalog or contact specific academic departments to learn more about additional costs. You'll also want to determine costs for technology, including a laptop and software you may need for specialized coursework.
If you'll be living on campus or renting a place, considering your cost of living in addition to actual college costs is a must. Admissions staff can provide information about living on or off campus. Consider whether you'll be working and estimate how much you'll make working part-time while you attend school. In addition to traditional off-campus employment, your financial aid department can also tell you about work opportunities on-campus that are designed to help offset college costs.
College costs are rising quickly and currently outstrip national inflation rates; it's important to factor in annual increases for tuition and other costs. The Department of Education's College Navigator website offers calculators that can help with estimating present and future college costs.
Financial Aid Programs: What's Available in Addition to Student Loans?
Don't assume that you won't qualify for financial aid programs other than student loans. You'll want to file the Free Application for Federal Student Aid (FAFSA). This application serves as a universal application for financial aid programs, including scholarships, grants and federal education loans. Talk with a financial aid officer at your school to learn about work study programs, scholarships and grants offered by your school, and private resources. These resources can help limit how much you'll need to borrow as grants and scholarships do not have to be repaid.
Another option for financing college costs are federal PLUS loans for parents of college students. This option is useful for parents who want to help their college-bound kids avoid taking on too much student loan debt. Private lenders also offer student loans. It's important to check out your options and compare features, benefits and costs before deciding which education finance options work best for you.
How Much Can You Afford to Borrow?
When you're starting college, it's difficult to "fast forward" your thoughts to what will happen after you earn your degree and start your career. While students want to believe that a college education automatically leads to lucrative careers, economic factors and personal circumstances can potentially impact your actual situation. FinAid advises students to limit borrowing student loans to costs you cannot pay for any other way. This reduces the possibility of graduating with a mountain of debt that you cannot afford to repay.
While it's not possible to know exactly how much you'll earn after college, the Bureau of Labor Statistics provides average salaries for many careers. You can research national and regional salary information to get an idea of how much you can expect to earn in your chosen career. This information is helpful for deciding how much you can afford to borrow for college.
Once you have given these questions some thought, you should understand the process of how to get student loans.