The following post is a guest blog post from one of our good friends, Taylor, and he offers a unique perspective about student loans and will provide some great tips about taking out student loans! We don’t traditionally have these, but we always enjoy reading a different perspective and other avenues to take to become Financially Free! Please see the post below and we thought it could be for something of consideration:
Student loans are unavoidable now that the college fees are skyrocketing and with students wanting to get in the top-ranked colleges. However, when students take loans, it does not end there because then there is the matter of loan repayments. If you take out loans wisely and with some tips in mind, you may be able to manage them after graduation. Please see the following article for more information about student loans.
1. Federal Loans
Every year that you attend school to fill out your FAFSA or Free Application for Federal Student Aid, for better chances. The Office of Federal Aid can help students identify their loans federal grants, and work-study fund. This can help you pay for school, and the financial aid packages of your school will depend on this form.
Federal loans provide many advantages over the private loans, so always prioritize them. Federal loans have fixed interest rates while private loans have variable rates. Even if there is a low rate from a private lender, it can increase as soon as the next month. A fixed rate will give some predictability to your budget.
2. Free Money is Best
Free money never hurts when you have a ton of debt on your shoulders. Taking out loans means you need to earn money from a job and from any other reasonable way that you can. While student loans are helpful, unfortunately, they do have to be paid back. Scholarships and grants, however, do not have to be paid back, which means they should be on the top of your list. Often, students wait until senior year to figure out how they will be paying for college when they should start thinking about it way before than that. The more you delay this matter, by the more deadlines you will miss during that year.
3. Private Loans should Only be taken After Federal Loans
Student loans are unavoidable now that the college fees are skyrocketing and with students wanting to get in the top-ranked colleges. However, when students take loans, it does not end there because then there is the matter of loan repayments. If you take out loans wisely and with some tips in mind, you may be able to manage them after graduation. for more information about student loans.
4. Don’t Take Too Much Money
The first rule is not to take loans that you cannot handle. If you have a job, then do not take loan greater than your salary. Calculate the total debt you will have for all years of school. Get an estimate on how much debt you will have to pay each year while you are in college. And keep in mind your salary. In an ideal situation, your total debt should be less than your starting salary, so you are able to pay your debts under ten years.
With these tips in mind, you should do fine while you are taking your student loans.
About the Author:
Taylor Hill works for a financial technology company Stilt located in San Francisco which is revolutionizing the way individuals with limited or zero credit history get loans in the U.S.