9 Smart Steps To Minimize Student Loan Debt
Many people get into the work-force after completing their studies in college or university crippled by student debt.
The reason for this is that many did not look at the bigger picture when applying for these loans. Therefore, many people are forced to delay big life achievements like getting married, purchasing their first cars and houses because they are still paying their debts.
There are smart ways people can minimize their student loan debts and live a happier life.
Read on these methods below:
1. Explore Other Funding Sources
If student loans sound enticing, imagine how much more attractive getting through university on free money would be.
By free money, we mean exploring other more convenient sources of money like grants and scholarships.
Before going to apply for a student loan, try your luck at all the grants and scholarships available.
Some pay your fees and tuition partially while others pay 100% of your expenses.
2. Enrol In A Cheaper University
When choosing a university or college to enrol at, if you have to take a loan, always choose the cheaper university. It can be cheaper in terms of tuition fees and the daily living costs incurred.
This way, even if you take a student loan, the cost you will repay is not as exaggerated.
Your dream university might not give you the luxury of cheapness so you can look for other cheaper options in-state.
Or join a community-college as you save up for your dream university.
Before joining college, you can also look at a college savings plan and save money before joining.
Saving up before taking a loan can reduce the amount of borrowing you have to do significantly.
4. Budget Before Borrowing
When taking out any loan, you have to remember that the loan you are taking is not free and has to be repaid at some point.
This reality will push you to always budget for your needs as a student before taking the loan, and not vice versa.
Note down the expenses it is going to cater for including books, meals, housing and transport and avoid borrowing any more.
5. Sort Out Your Living Situation
Boarding expenses are expensive and if possible, should be avoided at all costs. For you to avoid them, you can opt to live at home with parents where you commute to school every day.
This is possible if the school is close to home.
If your campus is in another state, you can opt to get a roommate and live off-campus where you share costs.
6. Limit Your Expenses
With a loan, it is easy to get carried away thinking you have excess money. So, since the loan covers the essentials, try to minimize the living expenses incurred.
Minimize eating and entertainment expenses. This you can do by avoiding to eat out and choose to make homemade meals instead.
While all work makes Jack a dull boy, skip the random nights out as buying liquor is costly.
7. Get A Job
Getting a job is the easiest way to student loan debt. When you are still in school, work part-time and when school close, work full-time.
This way you can save up and pay off a significant amount of the loan by the time you graduate.
Some people have opted to put off school for a year or two so that they can work and save.
This way by the time they enrol, they have saved up enough to get them through school and even if they get a loan, it won’t be too much.
8. Graduate On Time
Once you join university, always purpose to graduate on time, not a year or two later. If you can even graduate earlier by a semester or two through taking summer classes, do it.
The less time you have to spend in school, the less debt you will have to pay off.
9. Evaluate Loan Options
It is important to evaluate all your loan options before taking a loan.
Keep in mind the interest rates and repayment terms of different loaning institutions and go with where it will add up to less money. Always check federal loans before going private.
It is also important to consult with your parents and older siblings who know the system before taking student loans.