Do You Need a Student Loan?
So, here you are, intrepid scholar, ready to embark upon the journey that will, hopefully, lead to the fulfillment of all of your hopes, dreams, and ambitions. All you need is to obtain that diploma and the keys to a successful future are as good as in your hands. Whether your goal is to change the world, make a mark in the history books, bring your brilliant vision to life, or simply to make shovel-piles of cash, you will still find yourself at square one, asking if you’re going to need to get financing to make this dream a reality.
Chances are, you will. Student loans comprise the largest percentage of loans taken out in our society, and their numbers can only grow. College is the single largest expense one can expect to incur before reaching their earning years. Fortunately, there are several ways to put together financing for college, and there are several financial sources you can potentially combine when you need a college or student loan.
Of course, the expenses for studying varies from school to school and for different kinds of diplomas. Some education paths might be so expensive that you will have to take out more than one student loan - no question about it! Still, college financing is cheap when you compare it with private loans. As a student, you can also take advantage of many varieties of school-based financial aid, scholarships and grants.
If you haven’t settled on a school yet, make a list of the universities you’d be interested in attending. Remember that not every institution will be the ideal choice for the degree you’re pursuing. Compare total costs of tuition for each university. At some point - tuition, fees, books, living expenses, travel expenses, and all - you will arrive at an estimate of what you will need.
It is a rather daunting figure, isn’t it? OK, before you rush off to change your mind and become a South Seas island refugee (well, some of them are happy with their lot in life!), remember that student loans and financial aid packages are amongst the cheapest possible loans you can get, and even cheaper when you consider the benefits they will reap you. Between the low interest rates and the fact that you can wait to pay them off until you start your career, you almost can’t afford not to get one.
The various kinds of student loan programs also have additional quirks. If you get a subsidized Stafford loan, the interest won’t begin to accrue until the day you have to start paying it back. You cannot find a deal like that anywhere else. Plus loans are taken out by your parents instead of you, ensuring that you get to “ride on the coat-tails” of the previous generation’s better credit history. Finally, always keep an ear to the ground for scholarships or grants. These are the best alternative, if you can find one that you qualify for.
Whatever you do, a private loan from a bank or other commercial institution should be your last resort. These will have the highest rates and the least forgiving terms. Here’s some food for though by way of access and more information on government grants.
September 11th, 2007 at 10:46 pm
[…] Being a student ensures qualification for the lowest interest rates. The terms of the loan and the interest rate charged are crucial factors when considering a student loan debt consolidation, as these will be the major costs of the finance. Students should also ensure that they are able to refinance in the future if they so chose. This can be important if more suitable finance options become available in the future. Students should also read the fine print for any pre-payment penalties that they may incur. You should ask yourself if you need a student loan in real terms. […]