When you’re looking to pay for school, lining up funding can become confusing. You may win an award, already have some loans or aren’t sure which loans are the best choice.That’s okay – quite frankly, it is confusing.
For starters, make sure you evaluate all of your options before you borrow.
Also, you never want to borrow more than you need. It may seem like free money now, but debt accumulates quickly, so you should avoid it as much as possible.
The following list will help ensure you accurately assess all your options to pay for school:
1. Evaluate and/or review any awards you’ve received.
When you win an award, evaluate your letter to make sure everything is correct and that you understand any terms or conditions.
This will help you assess your financial situation and determine if you require any further funding and, if so, how much.
2. Apply for “free money” before taking out more loans.
There are so many scholarships and grants for students that are essentially free money. These may seem like more effort – and they are. But, remember, any amount you don’t borrow is money you won’t have to repay later!
Don’t just assume that you won’t qualify for awards – there are literally millions of scholarships and award options for students and there’s bound to be more than one you qualify for.
In fact, there are some awards that all students qualify for!
3. Look at the big picture of your financial situation to determine how much you actually need to borrow.
Again, you never want to borrow more money than necessary. By understanding the scope of your financial situation, taking into account any scholarships, grants or other financial awards you’ve received, you’ll be able to borrow the exact amount necessary.
4. If you have to borrow, apply for federal student loans first.
Federal student loans generally have lower, fixed interest rates versus sky-high rates that private loans can carry. It’s in your best interest to start with this option first.
5. If you have to take out private student loans, evaluate and compare all of the available options.
Don’t choose the first private loan you see – compare rates so that you’re able to find a loan that’s manageable for your budget and has competitive rates. There are plenty of options out there, so make sure to do your research before signing anything!
6. When it comes to financial aid options, your mantra should be: the earlier, the better.
If you figure out your financial situation sooner than later, you won’t be strapped for time when looking for funding right before you need it.
Many of these application processes take time so start now if you see an upcoming need in the future!
By: Elizabeth Hoyt