Save Money by Minimizing Student Loans

Do you know any students who have borrowed more money for college than they know how to pay back? These might be students a few years older than you, and they might be entering the job market by now. What are the struggles they face?

Fortunately, as a recent blog entry showed, more students now are finding ways to minimize the amount they borrow for their education and/or career training. Many students work to earn money for their education, and many families are using their savings to avoid student loans. This saves them a lot of what they would otherwise pay in interest. It enables them to pay less money in all, and pay back their loans much earlier than they would otherwise.

It might not be a concern to you now, but you will likely want to buy a house eventually, and that costs more than your education: a lot more. There will be many things you will need to save money for over your lifetime: for down-payment on a car, and eventually on a house. Farther down the road, you will also want to save for your children’s education and for your own retirement.

Don’t take this as a downer; it’s simply the truth. It’s the reason why your parents might be concerned about your spending habits now. Over-reliance on college loans, and using them to pay your living expenses, can lead to crushing debt.

And consider this one other fact: Educational loans are not covered under bankruptcy law, so you can never get out of them! Defaulting on your student loans can lead to an existence similar to debtor’s prison, which was abolished many years ago. This is something we all want to avoid.

College costs more all the time, but many students choose to attend less expensive colleges. By paying in-state tuition, you save a great deal. You also might consider attending a less expensive two-year community, technical, or junior college, and then transfer your credits to a four-year university. Just be sure that the four-year institution you want to transfer to will take your credits.

By attending a community college in your area, you could save money by living at home. You might also be able to do this if you attend a four-year institution that is close enough to home. This way, you don’t have to pay for a dorm room or apartment, and you also save on food expenses.

Reducing your dependence on student loans will save you a lot in the long run.

READERS, what do you think?

How much do you think you could save by living at home while going to school, rather than in a dorm or apartment?

And what are other ways you can think of to save money on your education and living expenses while in school?

Reference:

Hicken, M. (2014, August 1). How Americans Are Paying for College. CNN Money. Retrieved from http://money.cnn.com/2014/07/31/pf/college/paying-for-college/index.html?iid=SF_PF_River.