With each passing year, paying for college becomes more difficult.
High tuition prices have made getting a degree without debt nearly impossible. For many students, the target is to get a degree with minimal student debt.
Leaving school with affordable and manageable debt levels requires careful planning. The students who are willing to make some sacrifices during school can get an excellent education without jeopardizing their financial future.
Total student debt isn’t the most significant factor in being able to afford student loan payments.
It might sound crazy, but $40,000 worth of loans could be a much more difficult challenge than $125,000.
Private loans can be brutal. Help for those facing hardships doesn’t last long. Borrowers who can’t make payments will rack up late fees and destroy their credit score.
Federal student loans are designed to always be affordable. They also provide borrowers with many paths to forgiveness. There are many flaws with federal student loans, but the perks and protections make them a far better option than private loans.
Students worried about debt after school should focus on avoiding private loans. Those looking for a degree and minimal student debt should start by sticking with federal loans.
Students across the country work hard to get into their “dream” college. Getting accepted and starting school may feel like a justified reward for hard work.
Unfortunately, this approach to college could be costly.
One of the dirty secrets of higher education is that the first couple of years of a four-year degree are often unimportant. The first two years usually include general education coursework and introductory classes. Large numbers of students also change their major during this time.
Taking these early classes at a community college can save a fortune.
Students going this route should investigate credit transfer options to various four-year schools of interest. Most community college students plan to transfer their credit to a university. Both the community college and four-year college should be able to assist with transferring credits.
Community college is ideal for students who want a degree with minimal student debt. It takes a bit of extra effort in planning, but the value is undeniable.
State flagship universities are usually very highly regarded and affordable for the residents of that state.
While these schools can be significantly more expensive than a community college, it is in years three and four that they prove their value.
During the last couple of years of school, students cultivate relationships with faculty experts, get exposure to the job market, develop skills in their chosen field.
If you are a computer engineering major, the professor teaching your required Intro to U.S. History course if of little importance and unlikely to influence your career path. However, the professor with connections at Intel, Google, and Apple could be very significant.
All students who graduate from a top school get the same valuable degree and exposure to the leading experts in the field. The ones who only attend for years three and four save a bundle in the process.
A huge advantage to graduate students is that the federal student loan borrowing limits are dramatically higher.
This means students can theoretically afford to attend an expensive private college without taking on risky private student loan debt.
Further good news for graduate students is that the last degree earned usually is the most important degree. If you are hiring a lawyer, the place they went to law school matters far more than where they went for undergraduate studies.
Finally, a college graduate is in a much better position to evaluate the job marketplace and do a cost-benefit analysis of a graduate school. A high school senior will have a much bigger challenge with this task.
If a student is going to take a risk with an expensive school, it should be much later on in their studies. The high cost of education is still a major concern, but by making smart decisions early on, student debt levels can remain manageable.
There are many different ways to keep student loans manageable and affordable.
The purpose of this particular article was to share one way of accomplishing this goal.
The two major takeaways for students considering their options should be:
Avoiding private student loans, and
Saving money on classes and educational requirements that are less important.