Ways to avoid student loan debt
Some Americans believe that the way to advance in life and your career is to continue to receive education after high school. The issue that nearly everyone faces is the inevitable student loan debt that accompanies these degrees. If college is something you are pursuing, then it makes sense to consider what the financial obligations are going to cost you in the long run. Any student loan debt must eventually be paid, so there is no way to hide from it if you rack it up. However, there are ways you can avoid a big pile-up of debt right after graduation. Here are ways to avoid student debt:
Apply for Financial Aid
Applying for financial aid seems like a no-brainer. This is money loaned to you to cover the cost of college. However, the process of applying for financial aid doesn’t end with loans. They typically offer ways to apply for scholarships and grants. Yes, this is free money given to you for college that comes with no strings attached.
Besides applying for scholarships and grants through financial aid, there are a plethora of other ways to apply for scholarships. This is something that every college student should always take advantage of.
You Can Say ‘No’ to Money
When you apply for a student loan, you do not have to accept all that is offered to you. Wise students will be cognizant of what they need and what they can afford to pay back after graduation. A simple way to approach this is to make a real-life college budget that details what money you truly need each semester. You should not use loan money for dinner dates, parties, or anything beyond the actual cost of tuition, books, and related costs.
You can really bury yourself into unnecessary debt by taking all the money offered to you. It is very easy to accept more money than necessary when you do not need to make payments until after you finish your coursework. It is best to think about the future and how much you will actually be able to pay back once you secure a job in your field.
Another easy way to cover the cost of college and avoid student loan debt is to work while you take classes. For some, this is easier said than done, but it can be absolutely doable. Many campuses offer jobs to students and some include things like tutoring, library assistant lifeguarding, etc.
Also, consider the opportunities for jobs that allow you to create your own schedule (like rideshare) or jobs you can do from your dorm room. Keep in mind, you do not need to focus on your major to snag a college job. Paying the bills at the moment is more important than waiting for just the perfect position.
Budget for Hidden Costs
Undoubtedly, college comes with hidden costs. These can be tricky to budget for, but you can make an estimate to be prepared for. Examples include additional equipment for your major or materials not needed in other fields. You may also pay extra for things like transportation, clothing, computers, Greek Life, or other extracurriculars.
Lastly, you want to budget for trips back home. For some, this might be easy if you are still in the same city, but for others, these trips can really add up. Keep in mind that expenses in college are not always cut and dry.
Start Paying Before Graduation
If you are really looking to get ahead, you can make payments towards your student loans before you even graduate. This is a great way to save a boatload on interest and begin to chip away at a loan. If you have the ability to pay your interest off before the grace period ends, you can avoid something called interest capitalization. This is an event where your loan’s interest balance gets lumped into your principal balance. Once this happens, you get charged interest on the total amount.
Final Thoughts on Ways to Avoid Student Loan Debt
If you are working towards ways to avoid student loan debt before you even step foot onto a college campus, you are already ahead of the game. Getting into student loan debt can be exhausting and overwhelming. The thing is, there are plenty of ways to avoid some, if not all, student loan debt if you pay attention and work hard. College can be fun, but it can also be a time of growth and wisdom.