If you’re going to college, chances are you’ll have to borrow money to complete your education. When it comes time to pay back those loans, it’s easy to get in over your head and become overwhelmed. Here are five tricks to keep your student loans down to a minimum.
1. Borrow Only What You Need
Although it’s tempting to borrow the maximum amount of money you’re eligible for, that can get you into financial trouble at repayment time. Figure out what your tuition, books, supplies, transportation, food and housing costs will be, and keep the loan down to that amount. In other words, live within your means.
2. Take Advantage of Grants and Scholarships
Besides the standard Pell Grant, other types of grants and scholarships may be available if you’re a member of certain groups or plan to go into a specific profession. You’ll have to research these opportunities and some of them require a lengthy application, but they’re well worth the effort.
3. Only Use Federally Subsidized Loans
Unless you absolutely need more money than you’re qualified for to pay your school expenses, stick to federally subsidized loans. You’ll usually get a better interest rate, and you’ll be eligible for reduced payment plans and interest-free deferment if you need it.
4. Get a Job
Many colleges and private employers have jobs available that accommodate your class schedule. Not only will you gain valuable work experience to put on your resume, you’ll also need to borrow less money.
5. Consider Loan Forgiveness Programs
For fields of study leading to certain professions, you may be eligible for loan forgiveness. For example, if following your graduation, you work full-time in specific public service, education or government positions, you could have the remainder of your loan forgiven after a certain number of payments. It could be well worth your time to research these opportunities.
Before you start college, have a plan for how you’re going to pay your loan. Create a time line with a goal, and stick to it so it doesn’t bog down your financial future.