Student loan debt is something that more college students must become aware of as this problem is increasing and leading to further financial problems after college graduation which may follow students for years to come. Understandably, students are finding that meeting college tuition costs is becoming more difficult and few feel that there are alternative options outside of borrowing to meet these financial needs, but when it comes to the size of debt that students acquire, it seems that more men and women are nearing a point where a default will be likely when they graduate and attempt to manage this debt after school.
However, students feel that loans can be easily managed due to the fact that, for federal loans specifically, low fixed interest rates are usually associated with these types of debts and, when it comes to situations where multiple debts are in place, student loan consolidations can offer affordability as well. As an example, interest rates that are currently available for students on subsidized and unsubsidized loans are usually around 6.8%, while consolidation loans for undergraduate debt is currently around 4.5%. Also, federal loans typically give students the opportunity to find more affordable monthly payments, as student loan consolidation, income-based repayment plans, and even forbearance opportunities are available on these types of debt, but there have been some mistakes that students have made that have caused their overall college costs to increase thanks to borrowing.
The first thing that students must avoid, particularly at this late date where free financial aid may be less available, is to rely heavily on student loans for not only the current semester but subsequent semesters and their overall college career. If a student must take out a hefty amount of loans for a particular semester, this should lead to more research, contacting the student financial aid office at their college or university, or even looking for work study programs or a part-time job on or off campus to help meet tuition costs in later semesters.
While finding scholarships is not as easy as it seems, there are a wide number of opportunities students can take advantage of after they have applied for FAFSA financial assistance, as there are specific scholarships that will only be available to certain individuals in a particular major or there are institutional financial assistance plans that are available only to students at a certain college. Yet, there are students who have truly exhausted all of their resources, applied to multiple financial aid opportunities, but still are in a position where they cannot meet the tuition that is required.
Aside from heavily researching colleges before a student even begins their academic career in order to see which ones are the most affordable or could offer the most free financial assistance, students who are currently enrolled at a costly university may turn to private student loans as an alternative if federal loans have been exhausted, and this is usually an option that should be avoided at all costs as these forms of debt usually can be more difficult to repay if financial problems arise and may come at a higher cost.
When it comes to keeping debt associated with college low, students must make sure that they look at a variety of colleges and, in some cases, some may have to select a college that isn’t their first choice if enough financing is not available, but also, exploring scholarship and grant opportunities as early as possible, tapping resources that may be available directly from a high school guidance counselor or college financial aid office, or even going so far as to get on a financing plan at that allow students to pay throughout the semester may be able to not only lower the debt that they must borrow but help avoid student loans entirely so a student can graduate college debt-free.