We’ve all heard the stat; student loan debt in the U.S. has exceeded a trillion dollars, which is more than the nation’s credit card debt. Just writing this makes me want to retch all over my computer keyboard. I myself am part of the two-thirds of all college students who have graduated with student loans. 2 years out of college now, and I have barely chipped away at my debt. In my opinion college has become big business and the quality of education at our colleges and universities has seriously deteriorated. But I digress. The point of this rant is to let all the college-bound students (and their parents) out there know that if you are smart there are ways you can avoid getting in over your head with student loans.
Last week we published the results of our July poll question: What Has Student Loan Debt Held You Back From? Now, let’s look at the ways we can minimize and avoid this debt…
Consider all the options.
Unfortunately, one-third of college graduates end up taking jobs that don’t even require college degrees. Before you make the decision to attend a private school for $40,000 a year (or more), really think about where it’s going to get you in the long run. Maybe you are better off learning a trade, or attending a community college. If a bachelor’s degree is what you really need, consider getting your education at a state school instead of an expensive private college.
Take courses at a community college first.
If you decide that a bachelor’s degree is what you need, take your core classes at a community college first. Then transfer to the school where you want to earn your degree.
Live within your means.
In life, it is important to not spend more than you make. Sure, we all want to drive a BMW but not all of us make the kind of money to do so. We could take out a car loan and spend our entire paycheck every week to pay the bill, but we don’t. You should follow the same principle when it comes to borrowing money for school. A good rule of thumb is to try not to borrow more money than you are expected to make in your first year of employment.
Work while you’re in school.
The typical U.S. college student spends less than 30 hours a week on academics. You will have time for a part-time job; believe me! Working during college and living on a budget will only help you in the long run.
Commute from home.
You can save a serious amount of money by living at home and commuting to class. Although this may not seem like the ideal situation, it may be the only way you can really afford to get the education you want. Think about it this way…If you take out too much in loans, you will most likely end up living at home after you graduate. Would you rather live at home now or move back home once you’ve been on your own for four years?
Only take out the loans you need.
Don’t be tempted to takeout more loans to help you live comfortably, such as loans for living expenses or furniture, or even vacations. You’ve chosen college therefore you have chosen to live like a “poor college student” for four years.
If you know what you are getting yourself into and take measures like these, it is possible to come out of college with a manageable amount of debt. Just remember, you can’t hide from your student loan debt once you’ve accrued it and it won’t go away.
What advice do you have for avoiding student loan debt?