How To Avoid Taking Out Too Much In Student Loans

Flickr user Jason Rogers

While many college students will graduate with some amount of debt, you should at least consider different ways in which to minimize your potential student loan debt.

Here are 8 things you can do to help you reduce the amount you need to borrow towards the cost of college.

How To Get Out Of Student Loan Debt

Start Earning and Saving Early

The types of jobs you can take on and how much you can earn will depend on your age but you should know that it’s never too early to get started. 

If your goal is to minimize your borrowing for college, it is equally important to save what you earn and put it towards college. Spending your earnings on fun stuff and luxuries defeats the purpose.

The 529 Plan, Coverdell ESA, and Standard Savings Accounts are great account options for putting away your college savings. Check out the pros and cons of each so you can manage your savings wisely.

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Work Hard in High School

Getting good grades in high school will make it easier for you to win merit-based scholarships and be offered better financial aid packages from colleges you apply to.

But don’t just focus on your academic grades. Colleges also look at your extracurricular activities to determine whether you are a well-rounded student. This does not mean you should participate in every activity that comes your way. Choose two or three or even just one activity and strive to excel in your chosen activities. Excellence in your chosen extracurricular activities can also help you rack up considerable scholarship awards.

Spend Time Looking for Scholarships

Scholarships give you free money towards college. Nothing can beat that. Sure you have to spend some time looking for scholarships but it is totally worth it. When looking for scholarships don’t restrict your search to academic merit and athletics. There are scholarships available for just about any criteria that you can think about and then some. Every scholarship dollar you earn is one less dollar you have to take out in student loans.

You can find scholarships that are based on religion, culture, minority status, and whether you are the first person in your family to attend college. You can also find scholarships for more unusual criteria such as height, ability to speak Klingon, talent in knitting or quilting, and skill in putting together the most creative PBJ sandwich.

Rethink your Choice of School

Will attending your expensive dream school leave you buried in student loans? Is it really worth over-extending your debt just to graduate from that one college? If you look around you are sure to find other colleges that offer comparable academic and extracurricular facilities at a fraction of the cost. Choosing a more affordable schooling option can save you thousands of dollars in student loans.

When drawing up your shortlist of colleges, you must first explore the public schools in your state. State schools receive funding from their state government, which means you pay much lower fees to attend a public state school as compared to what you would pay to attend a private institution or an out-of-state school.

File Your FAFSA As Early As Possible

When you file your FAFSA could impact the financial aid package that you receive from your prospective schools. Schools reserve limited funding to be allocated to students and financial aid packages are put together as they receive students’ FAFSA applications. If you file your FAFSA later on in the cycle, chances are you may be offered a smaller financial package depending how much funds are still available.

Another important thing to remember is that the FAFSA is not a one-time deal. You have to file it every year you are in college in order to receive financial aid for that academic year. And, every year, you must remember to file your FAFSA early on in the cycle. In addition to federal student loans, the FAFSA also qualifies you for certain grants and scholarships, which will help you reduce the amount you need to borrow by way to student loans.

Work Part Time in College

If you receive a work-study offer as part of your financial aid package, that’s a great way to earn some money to offset your college expenses. But even if you are not offered work-study you can still take on a part-time job or a paid internship during your academic year. Your earning potential may be limited by the income cap imposed by the government but you will still earn enough to lower your debt substantially. This will only work if you save your earnings though so that’s something to keep in mind.

Make and Stick to a Budget

Very often, it may seem like you are not buying stuff unnecessarily but spending on little things can add up to a lot if you are not careful. You have to be especially careful if you are using a credit card for your purchases. The best way to keep your money in check is by creating a budget that documents how much you are earning every month compared to how much you are spending on what you are spending on. This will help you cut out all those unnecessary impulsive purchases so you can save more towards your tuition.

Look For Ways to Reduce Your Expenses

Do you have an expensive meal plan? Do you really need it? You can save a lot by simply buying a cheaper meal plan and buying some groceries from the supermarket.

Buying brand new text books every year can be hugely expensive but you don’t have to go that route. Buying used textbooks instead can help you rack up those savings every year.

Look for other ways that you can reduce your expenses. You don’t have to forego everything to save money but you can save a lot just by cutting back on some things such as patronizing high end restaurants and buying only brand-name clothes and shoes. The more you save on these extras, the less you have to borrow in student loans.

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Lender	Rates (APR)	Eligibility
	5.50%-16.12%* Variable 3.99%-15.61%* Fixed	Undergraduate and Graduate	VISIT CITIZENS
	5.54% - 15.70% Variable 3.99% - 15.49% Fixed	Undergraduate and Graduate	VISIT SALLIE MAE
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	5.66% - 14.72% Variable 3.69% - 14.56% Fixed	Undergraduate and Graduate	VISIT ASCENT
	3.70% - 8.75% Fixed	Undergraduate and Graduate	VISIT ISL
	5.62% - 16.85% Variable 3.69% - 16.49% Fixed	Undergraduate and Graduate	VISIT EARNEST
	5.00% - 14.22% Variable 3.69% - 14.22% Fixed	Undergraduate and Graduate	VISIT ELFI

College Raptor is not a loan lender and does not assume responsibility for suggesting a loan to a user who may not be eligible for it. Rates, terms, conditions, eligibility, approval, and other considerations are the decisions of the lenders and may vary depending on which lender or marketplace the user selects. We urge users to carefully consider and review all loan options and terms before committing to taking out a loan.