The cost of attendance at college is high, and most graduate and undergraduate students require some form of financial assistance to pay for it. If you’re one of those students, don’t worry; there are plenty of ways to ensure that you have the financial capacity to pay for college while minimizing your eventual student loan debt.
Federal student loans
One of the best methods to ensure that you have the financial capability to pay for college is by taking out federal student loans. These loans are typically low-interest and offer flexible repayment options, making them an excellent choice for many students. Plus, if you decide to pursue a career in public service after graduation, you may be eligible for student loan forgiveness.
Student loan borrowers can choose from various repayment plans, including the Standard Repayment Plan, which has a fixed monthly payment amount for up to ten years.
There are also income-driven repayment plans, which base your monthly payment amount on your income and family size. These plans can offer lower monthly payments and may even forgive any remaining balance after 20 or 25 years.
When considering any loan, check when interest payments will start, whether you will be able to afford the monthly payments, and the total amount you will have to repay.
Private student loans
Private student loans are an ideal option for students who don’t qualify for federal aid or need additional funds to cover their costs of attendance. Banks or credit unions typically offer these loans, and they usually have fixed interest rates.
A private student loan typically has higher interest rates than federal loans, but they may offer features that make them more attractive to some borrowers. For example, some private lenders allow you to choose your repayment start date or provide an option to make interest-only payments while you’re in school. Private student loan borrowers also can choose from a variety of repayment plans.
When looking for the best private student loan, consider the following questions:
- What is the interest rate?
- Are there any origination or prepayment fees?
- What is the repayment term?
- What is the grace period?
- Is my credit score sufficient to qualify?
- Do I need a cosigner?
- What is the minimum monthly payment?
- Is there a cosigner release option?
- Are there loan origination fees?
- What is the repayment period?
Researching and comparing different private college loans is the best way to find one that meets your needs and fits your budget. Be sure to compare interest rates, repayment terms, fees, and other features before deciding what is the best private college loan for you.
Personal loans
Another option for financing your education is through personal loans. These loans are typically unsecured, which means they don’t require collateral. Personal loans can be used for different purposes, including consolidating debt, paying for a large purchase, or financing a significant expense like college tuition.
When considering a personal loan, research the interest rate, fees, and repayment terms before applying. It’s also essential to compare different lenders to find the best deal.
Some personal loans use variable interest rates that change over time, while others have fixed interest rates. Be sure to choose a loan with an interest rate that you can afford.
You should also consider the fees associated with the loan, including any origination fees or prepayment penalties. These fees can quickly add up, so be sure to compare different loans before you decide which one is right for you.
Financial aid scholarships and grants
Financial aid is provided as scholarships, grants, or loans, and it can help you cover the cost of books, fees, tuition, and other expenses. To learn more about financial aid and how to apply for it, be sure to visit your college’s financial aid office.
These funds are typically awarded based on merit or financial need, and they can go a long way in helping you cover the cost of your education. Be sure to search for scholarships and grants you may be eligible for; you may be surprised at how many you find.
Student loan refinancing
Suppose you’ve already graduated and you’re looking to lower your monthly payments or pay off your student loans faster, for instance, with a Navient student loan. In that case, you may consider a Navient student loan settlement or refinancing your student loans. When you do a settlement or refinance, you will get a new loan with a lower interest rate and different repayment terms.
You can use student loan refinancing to consolidate multiple student loans into one loan, simplifying your monthly payments and lowering your interest rate. You can also use student loan refinancing to extend your repayment term, lowering your monthly payments. Before refinancing your student loans, compare offers from multiple lenders to find the best deal.
Work-Study programs
Another clever way to pay for college is through work-study programs. These programs allow students to work part-time jobs to earn money to help cover their educational expenses. Work-study jobs are typically related to the student’s field of study, so they can also help gain valuable experience in their chosen career.
Live at home to save on rent and other expenses
If you’re looking to save money on college, one of the best ways to do so is by living at home. This will allow you to avoid paying rent and other living expenses, such as utilities and food.
Get a side hustle
In addition to working a part-time job, you can also earn extra money through side hustles, such as freelancing or pet sitting.
Explore Your Options
There are many different ways to ensure that you have the financial capability to pay for college. Be sure to look into all possible options and choose the best method for your future.
If you need extra motivation, read 8 Qualities That Lead To Success.