Things you Should Know before Taking out Student Loans
Taking out student loans is a big commitment. You may have seen the math on how quickly your interest will accumulate, but you might not realize how much of an impact those payments will have on your lifestyle for years after graduation. When considering student loans, it’s important to weigh your other payment options as well as consider the financial potential of the degree you’ll be pursuing.
Other Financial Options
Not all high schools do a good job of informing soon-to-be college students about the different grants and scholarships available to them. And often nontraditional students don’t know about all of the payment options available to them. A good place to start is by checking with the guidance office at the institution you plan to attend or at your high school.
Another approach is to search online. Is there something that makes your case particularly extraordinary? Do you have a talent or background that sets you apart from the mass of other students applying? Try searching these qualities along with “scholarship” or “grant” and see what you find. It might turn up more than you expect. Remember, you don’t have to choose one scholarship or the other; you can combine them. Obviously, it’s in your best interest to apply for as many as you can.
Don’t forget many students hold part- or full-time jobs while in college. If you could save yourself $10,000 or more in student debt by attending school for an extra year so you could work and go to school, would it be worth it?
Will the Degree Be Worth It?
This is always a tough consideration, but it’s one you still need to make. If you have to pay for your education by taking out a significant amount of debt, your degree should be one that will help you find solid employment throughout life. If you’d like to pursue a degree in something without a guaranteed job right after graduation, you need to be ready to work hard at (possibly multiple) lower-paying jobs that might not be your passion. Perhaps for a very long time.
This doesn’t mean you can’t study what you want. However, it is hard to empathize with someone who has a degree in the history of underwater basket weaving as it relates to Nordic epic poetry when they complain they can’t find a job to pay their $700/mo. student loan bill. By all means, study the history of underwater basket weaving as it relates to Nordic epic poetry, but make sure you can pay for the degree up front with cash or scholarships, or have an air-tight plan to work at whatever jobs you can find to make ends meet.
Borrow Only What You Need
When you qualify for a lot of financial aid, it can feel tempting to live the high life a little. Instead of a dorm, you might be tempted to choose a chic apartment. Instead of cooking for yourself, you might opt for a bunch of meals out on the town. However, if you don’t resist this urge, you’ll probably be back living with your parents after college.
Student loans are a powerful tool, but they should be treated with caution. If you’re not careful, they could torpedo your ability to obtain credit in the future. With some careful planning, however, you won’t have anything to worry about.