After scholarships and traditional saving methods, you may be scratching your head to come up with ways to pay for college. Sometimes it takes a little creativity to avoid college debt. Here are two unique student loan debt relief options.
Reasons to Avoid College Debt
Even though there are talks this election cycle about free college tuition, that scenario remains unlikely. Paying for college can be an incredible feat and many lack good financial counseling surrounding debt. Most rely on private and Federal student loans to cover the majority of the costs. Scholarships, grants, support from family, as well as the student’s own savings make up the rest.
Is it a bad thing to have student loan debt? No, not necessarily. Education debt is actually considered to be a good type of debt since it’s an investment. However, it’s very important to weigh the amount of debt you will be taking on verse your future career and ability to pay back that money. You don’t want to over-borrow and then need a major student loan solution.
Student loan debt can also become a big obstacle when it comes to those big life goals many strive for. Marriage, homeownership, and retirement are some of the goals that can be impacted by debt.
To avoid college debt, you might need to think outside the box to really lower the amount of money you borrow to pay for school.
Unique Ways to Pay for College
To keep your debt low and your future financial milestones on track, it’s critical to avoid too much student loan debt. Since you probably already know about scholarships, working hard at a job, and of course loans, it’s time to take a look at some other options to help with debt reduction.
Sell Your Car to Avoid College Debt
Most likely you have only owned your car for a few years. You might really like it even. But saying goodbye to your car can save you quite a bit of money. The first two years of school often mandate students to live on campus anyway. If there is public transportation in the area and you can successfully get around, consider ditching the car for a few years.
First, you won’t have any more car payments or insurance premiums. This could save you thousands of dollars each year. You also are free from any future accident or maintenance costs, not to mention filling up your tank. All this money can go towards paying for college rather than adding more student education loans.
If you like the idea of ditching the car but don’t want to sell it, think about taking it off the road. If your parents or a friend can give the car a home for the next few years, it might be worth it as well.
Match Your Kid’s Savings
Parents, this one is for you. Maybe you weren’t able to start a 529 plan when they were young, but you can still contribute some financial help now. Talk to your kids about saving for college and how you will match whatever they save.
You may need to set a limit on the amount that you will match. No reason to go broke helping your college-bound child. There are also credit unions with savings accounts that have matching fund features you can explore.
This will not only get your child a manageable amount of additional funding for college, it can be a great motivator. The more work they can do to avoid college debt the better off they will be in the future.
These are two ways you and your child can save for college beyond the traditional tips. Check out this student loan calculator to get a clearer picture of the financial impact of your choices.