Thinking About Borrowing?
Being a college student money is definitely an issue and if you don't quallify for finacial aid college can be very expensive. The cost of intution and books can leave a hole in your pocket and if you don't live close to campus your going to need money for gas and food. Getting a student loan can be the solution to your money needs ,but before crossing the street stop and ask yourself some of these impotant questions that I have helped answer.
How much should I borrow?
You should borrrow only as much as you need. You will have lower monthly payments when you are repaying your loan. In return, you will have more money for things like rent, bills and the expenses of starting a new career when you leave school.
How can I reduce the amount I need to borrow?
File for a Free Application for Federal Student Aid (FASFA), you'll automatically be considered for aid from all of the programs offered by the U.S Department of Education, including grants and work-study. Also, your FAFSA is often used by your school to award grants and scholarships from other organizations, which may reduce the amount you have to borrow. If you search the web for free scholarships you might come across some additional aid.
You can also work part-time to help pay for college. Working and going to school is not for everyone but it does look good if you are trying to transfer. Working also can provide you with vaulable experience and skills needed for your career.
How can budgeting help me?
Having a budget while in school can help reduce the amount you need to borrow. Add up your expected monthly expenses and subtract that from your monthly income. If your income is less than your expenses then you have a budget problem. Either reduce your expenses or find another source of income.
How will my student loan fit into my budget after I Graduate?
To start a monthly budget, begin with your expected annual income. You can get estimates of salaries in different careers by checking online, and it may help to check jobs adverised in the area where you plan to live. As you make your budget, first subract 30 percent of your salary for federal, state, and local taxes. then divide the remainder by 12 to find your monthly take-home pay. Then estimate your monthly expenses such as rent/mortgage, groceries, car payment, bills. etc.
Can I get help repaying my loan?
There are some careers that can help you repay your loan. For instance, you might be eligible to have as much as $17,500 of your Direct Subsidezed or Unsubsidized Loan cancelled after 5 years of teaching in schools in low-income areas (for more details, see Student Aid on the web at: www.studentaid.ed.gov). As a part of their recruitment programs, the Armed Forces may repay your education loan if you enlist in the military. For more information, contact your local military service recruitment office.
Other questions to think about?
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- Federal Direct Loans
This website provides information for college students, parents, and financial aid professionals about the U.S. Department of Education's Direct Loan Program.