The student loans may seem frightening — they sound just like hearing a foreign language when you ask for help in an unknown land, surrounded by complete strangers! Still, as a student, you may face the situation when you need to finance your study without a possibility to collect money beforehand. Therefore, we are here to save you from all the stress and uncertainty.
We would like to offer some important tips and advice from Homework Lab team of educational specialists to help you out with the understanding of the student loans in a better way. Trust us, we all have been through the struggle in this way or another. Hence, once you know the basic rules and remain attentive, the things are not so scary anymore!
The most important rule is to do your best to avoid a student loan from becoming your financial drag for years even after graduation. While it is one of the most disturbing problems for the students in the United States, there are still some ways how you can address and improve the situation. According to the reports of the Federal Reserve Board of the United States from July 2018, the students have $1.36 trillion in debt, so you are certainly not alone! Here are the tips that we want to share with you:
● Study and examine the Free Application for Federal Student Aid before you fill it in! It will help you to learn about the additional costs of staying in college and an amount of what your family has to add to the total amount. The information is there, so the task is to learn it with great care and patience before you hurry and check the wrong options.
● Do not borrow more money than you actually need! The trick here is to develop a strong college planning strategy in advance, so you can (and should!) find the right balance between college needs, financial aid, special financial help due to GPA level, and the tax aid, depending on your family situation.
● Keep an eye on your loan-to-income ratio! The golden rule here is to borrow funds at a 1-to-1 ratio in relation to the income that you expect to have after graduation. For example, if you expect to make around $30.000 during your first or the second year after graduation, do not risk by taking more than that amount. While there are differences like with the healthcare, this rule still works!
● Seek alternatives to money borrowing! Before you take any student loans, think hard about the ways how you can minimize or even get rid of a necessity to borrow money. For example, you can apply for a scholarship or work part-time. Even a full-time job may be an option once the working conditions are suitable! Additionally, you can attend a community college and study the opportunities. Remember to study the on-campus and off-campus housing options available!
● Do not overpay for your education! Just a friendly advice – do not trust the colleges that have high tuition costs and promise a great future right away. What always counts is an education per se, your grades and actual skills you have! While there is such thing as the brand name or a famous university fame, there are always exceptions! Do not become an exception to the shady promise rule. As you are only starting, and if you are unsure about your future major, choose a community college first for your first and a second year so you can make up your mind without extra costs!
In conclusion, I want to remind once again that here at the Finance Fox, I offer all the possible kinds of help and share personal observations and experiences for all things related to the management of personal finances. My mission is to help you save your money and spend them on things that you truly enjoy!
Always speaking from a personal experience, I have been through it all and know how hard it can be when one is faced with financial debts, loans, and student challenges with no one to help. Finance Fox website has been put together to help the students and anyone who wants to receive entertaining and easy-to-understand information ranging from the debt and loans to money-saving tips, credit cards, and handy business tricks!