Student Loan Debt: How Do I Afford College?
Getting into college is supposed to be an exciting moment in your life. But in the 21st century, that letter of acceptance is often followed by a single question: how will ever I pay for this? College has become an exceedingly costly time in one’s life. Tuition prices have doubled while wages stay stagnant. Yet college can also be essential to a person’s ability to thrive in post-college life. Here we will discuss ways to pay for college, with particular consideration for student loan debt.
While, at every school, there are some students whose families have paid for tuition in full, most students are paying their way through with student loans, and will leave college with student loan debt. When you receive your acceptance letter from a school, they will also send you a financial aid package that estimates the amount you’ll be able to receive in loans, the terms of said loans, etc. In order to receive this estimate, you’ll have to have submitted a FAFSA. A FAFSA, which stands for Free Application for Federal Student Aid, is, well, exactly as it sounds! The FAFSA is a free form that will determine your eligibility for all federal loan programs. You can fill it out online. Be sure to look up the FAFSA deadline in your state, as it varies.
Loans, grants, and scholarships—what’s the difference?
There are a few types of financial aid. Loans are the first and most common—and the trickiest since they need to be paid back. Student loans will begin to accrue interest as soon as you leave school, and given that there is a monopoly of loan servicers in the United States, it’s likely that monthly interest won’t be pretty (especially if you’ve gone to a really expensive school). The pro is that they are the easiest to get, and can open up your possibilities.
Grants are the next kind of aid. Grants most often do not have to be paid back, but could come with some kind of stipulation or project attached to them. For example, if you’ve been given an art history grant, the grant likely requires that you remain on the art history track during college. This is not the case for all grants, but is something to consider. Grants can come either directly from both universities and the federal government.
Lastly, there are scholarships. Most students dream of receiving a scholarship, as scholarships do not have to be paid back. Scholarships can be based either on merit, talent, or financial status. And while scholarships do sometimes have a requirement attached to them (most commonly this requirement is to maintain a certain grade-point average), they are often given freely.
There’s also work-study programs, which don’t fit neatly into any of these programs. As part of a work-study, which is most often federally funded, you will work in exchange for your tuition. Work-studies can cover full tuition, but often cover only a portion of it. And in some cases, students also receive pay for their jobs.
Key things to consider for student loan debt
Now that you know your options, the key to being able to afford college is looking ahead. Before accepting any college offer, it’s imperative to calculate what it would cost to go there for all four years, and then factor in the financial aid you’ve received. If you’ll be paying for college purely in loans, you need to ask yourself: will the kind of job I’m pursuing through my degree have enough of a salary for me to pay my loans back and still live comfortably? Student loan websites can be hard to navigate, but it’s worth calculating what your monthly bill post-college would be.
Sometimes avoiding student loan debt means making a tough decision and saying no to your first-choice college. Or it can mean ignoring that advice completely and going to your favorite, most expensive school anyway. At the end of the day, this is a highly personal decision between you, your family, and your bank account. Whatever you choose, just know you’re not alone; student loan debt is one of the gravest issues facing modern American society. College will be an amazing time no matter where you end up.