On average, a college student in the US owes roughly $40,000 in student debt and the amount has accelerated in the past few years. High tuition fees at college render most students unable to pay fees without taking any debt. A student loan default can affect your finances after graduation. You may miss some life events for financial reasons and adopt an austere lifestyle. You constantly worry about the repayments to the day your loan is finally repaid completely.
It is also possible to even default on a loan in the case you fail to make payments within time, which is a much bigger problem than student loan delinquency. This has severe consequences for the borrower. For such reasons, anyone would be unwilling to take on any debt but the fact of the matter is that most students cannot afford college without debt. However, that doesn’t mean you have no other options and you are doomed to drown in debt.
Let’s discuss some of the best to avoid student debt and minimize it in the case you are in debt.
Start Saving and Working Before College
If you wish to join college without student debt, you should start working part-time while you’re at school. At the same time, you should save as much as possible. This means missing out on some entertainment opportunities that are often expensive. It may discourage you to save since you will miss out, but everyone struggles with finances and one has to work out their preferences.
Aim for Scholarships/Grants
There are several scholarships and grants available to high-performing students. This means you have to excel in school and get top grades to qualify for scholarships. Obviously, this is a very competitive option, but nevertheless, a viable one to get into college without taking debt.
You can qualify for scholarships even after getting into college. For this, you will have to maintain a high grade-point average (GPA). It depends on the college policy but you can either get a full scholarship or a partial one depending on the policy and your grades.
Consider Community Colleges
You may want to apply for your dream college right away but bear in mind the finances. Most top universities have high tuition fees and other expenses. A community college is not a bad or discouraged option. It comes with many benefits. You can earn credits for several courses and then transfer to another college later on. This will significantly reduce your college education costs.
Live at Home
In addition to tuition fees, boarding and other living expenses at dorms can cause a notable increase in expenses. Living in dorms is definitely an interesting experience but you will have to sacrifice this if you intend to lower costs and not take any debt.
You can either choose a college in your city or live with one of your relatives. This will save huge amounts for you in expenses.
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Work Part-Time during Study
The opportunities are much broader for college students as compared to school students. You can work part-time along with your studies. There are several remote and in-person earning opportunities. Freelancing is another excellent way of earning as it allows for flexible timing for a student with scheduled classes.
If you want to focus solely on your studies to improve or maintain grades, then you have the option to do full-time jobs during summer vacations. There are also many on-campus jobs for students in a university, such as teaching assistants and college social media managers. Look into those for some extra money.
What If You Are Already in Debt
If you are reading this article, chances are, you already are in student debt and now looking for ways to minimize student debt. First and foremost, make sure to pay all payments in due time to avoid student loan default and also any extra charges. Next, graduate on time to avoid any interest building up.
Loan Consolidation plans are an excellent way to simplify your payments and even get lower interest rates. Student loan forgiveness plans exist to provide relief to students with certain criteria. Check out these programs and see if you are eligible. Consider Loan Refinancing as another option. If interest rates have dropped or you now have a better credit score, you can negotiate a lower interest rate on your loan through a refinancing plan.
Student loans have been increasing rapidly in recent years. College costs continue to go up. You need to consider all options before going into debt and even after taking debt. Be smart about your finances and graduate with either zero debt or a manageable repayment schedule. This is not an exhaustive list of student debt solutions but gives a good overview of some of the best options available.