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By on May 2, 2016 in Financial Aid
Image by COD Newsroom, Flickr

Image by COD Newsroom, Flickr

Planning for your future is one of those phases of your life that needs careful consideration. There is a lot of money to be paid for your college program, and you might end up either not being able to pay for it or left with the option to drop out.

There are easier ways to pay for your degree through student debt relief funds. Students can easily fix a principle amount for each month and the rest of the formalities for interest rate and term plan of the loan can be decided by the program.

However, there are a few key factors which must be considered by the student before he/she chooses the kind of loan they’d like and begins to make payments:

Choose Your Loan Program Wisely

There are many debt loan programs for students to choose from. However, a student must carefully go through the terms and conditions for any loan program and choose wisely which program may suit his/her needs, whether federal, private or government grants – it can potentially make all the difference.

Any loan program varies according to specific needs and requirements for the student and whether he or she qualifies for the program or not. It requires research and planning before any student can say ‘yes’ to a loan program. Discuss among peers and friends who might have opted out of a loan program and learn from their experience.

Planning Ahead

Once you have selected your program and have successfully gone through the process, plan out each and every dollar spending of your loan wisely. Remember, every dollar that you spend will cost you twice the amount when you have to repay that amount. Only plan out your spending for your educational program.

Also, look for additional student support programs to be able to pay for your loan. Part-time jobs or paid internships always come in handy. Always calculate your remaining debt and make arrangements beforehand to be able to pay for it – you don’t want to be in a situation where you’ll have to abandon your college program. Only borrow what you need initially and decide on the expected time period for repayment on the basis of your monthly payments.

Make the Smart Choice

People reason that Federal Student Loan programs are much easier to select, depending upon their fixed interest rates, flexible repayment plans, income based repayments and loan forgiveness aspects as compared to private student loans. Every student is different, so make the smart choice by doing your research – and don’t be afraid to get some counseling through your college’s financial aid office.

This article was contributed by guest author Henry Kingston.

By on September 15, 2015 in Student Loans
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Image by www.gotcredit.com on Flickr

Chances are, if you graduated from college, you have at least one student loan to pay off.  If that’s the case, my condolences.  However, you’re not alone.  All the better to budget with.  If you’re forced to save a set amount of money every month, you’re more likely to learn how to budget, and learn fast.  There are a number of ways to cut costs in your daily life. 

The first step is to make a budget that allocates a set amount of money toward bills, food, rent/mortgage, and daily expenses. Then, figure out how much is left over based on your income. If you’re in the States, find a tool that calculates whether you qualify for income-based repayment — via President Obama’s William D. Ford Direct Loan Program — and go from there. However, a warning: there are a number of different options for student loan repayment now, so beware of private companies that want you to refinance with them so that they can make a profit.  Here’s an infographic with a flow chart that’s easy to understand:

Students picture

While it may be tempting to simply allow your student loans to go into default, it’s probably not wise in the long run.  Defaulting can result in wage garnishment, tax refund withholding, even the revoking of your driver’s license!  That’s nothing to fool around with.  Better to go with the twenty-five year plan, if you’re short on cash — as many of us are these days.  There are a number of steps you can take to gain more control over your finances, even if you don’t feel like you have a lot of expendable income.

First, focus on what you can control.  How much money is left after you put aside your basic monthly expenses and student loan expenses?  As difficult as it might seem, try to set aside a little each month for a savings account.  You’ll be grateful when an unexpected expense comes along.  And try not to rack up a lot of excess credit card debt.  If you can’t afford to pay for something, maybe it’s not worth the additional expense every month.  If there isn’t enough money at the end of the day to simply get by, perhaps it’s time to reevaluate your career path and consider setting a goal to get a better job or return to school for a specialized certificate or a different career altogether.

A good rule of thumb in selecting a program of study is a) Are you passionate about this subject and, b) Is it practical? That is, are you going to school for a position that’s highly in demand?  An example of a field that is always growing and expanding is healthcare.  (I would say education too, but there are the salaries to consider.)  To give you an idea, here’s a visual with some useful numbers as ball park estimates.  Basically, you’re looking at 90K a year, at minimum. With that kind of salary, you should be able to pay off your student loans fairly quickly — within ten years, as opposed to twenty-five years. If you’re concerned about choosing between a second degree and quitting your job, fear not: there are now a plethora of online programs in nursing and healthcare for you to choose from.

If, on the other hand, you’re a burgeoning entrepreneur looking to think outside the box and go the route of starting a business rather than working for a company, you could always begin building your business while still in school.  If you go this route, you’ll likely have other types of loans to contend with: business loans.  How do you go about juggling student loans and business expenses, all while trying to raise enough capital for your business to grow?  Well, nowadays we have the Internet, and along with it come innovative crowdsourcing platforms like Kickstarter and Indiegogo. Interestingly enough, crowdsourcing is fast becoming a mainstream source of capital generation for startups, considering the increasingly important role social media is assuming in effective business marketing campaigns.

So take heart and have courage: you can do whatever you set out to do with your money or your career.  Just take things one proverbial step at a time, and you’ll be fine. If you have ideas to contribute about successfully balancing college, money, and career goals, either in or out of school, post them in the comments below.

This article was contributed by guest author Daphne Stanford.

By on July 24, 2013 in Student Loans
Image by jessiejacobson, Flickr

Image by jessiejacobson, Flickr

With all the costs of post-secondary education, it can become very difficult to find the money to pay for it. Luckily, with student loans, students can more easily pay for university/college. There are two forms of student loans: government loans and private loans (i.e. personal loans and student lines of credit). Depending on eligibility, students have the option to receive either. So, how do you choose which loan is best for you? Here are a few factors that can help you differentiate and choose between the two:

Government Loans

Private Loans
Interest rate Fixed interest rate and often lower than private loans. Variable interest rate that can substantially increase your debt if rates increase.
Loan repayment Repayment starts six months after graduation. Repayment assistance programs are made available for students who may need it. Monthly interest payments while in school and regular repayment (principal and interest) starts a few months after graduation. Repayment assistance is dependent on the institution.
Reapplying for loans Must reapply every year and takes approximately four to six weeks for applications to be assessed. Usually, half the loan is given during the first term and the other half is given during the second. No need to reapply each year. Typically, only Proof of Enrollment is necessary and funds will be available shortly afterwards.
Parental involvement Your parents’ incomes will affect the amount of your loan. The higher their income, the less financial aid you receive and vice versa. Usually need a parent to be a cosigner/supporting borrower.
Extra Perks You will be automatically assessed for Canada Student Grants when you apply for a Canada Student Loan. Also, government loans differ province to province and territory to territory. Some offer both federal and provincial/territorial loans, while others only offer one or the other. More information and applications to each province/territory’s respective financial aid websites can be found below.

 Depending on the institution, a lot of aid can be made available to students; much more than that offered by government loans. Here are some options available for Canadian students:

Here are some options for American students:

Final Thoughts

With all the perks of a government loan, why doesn’t everyone just apply for them as opposed to private loans? Simply, it is because not everyone qualifies for these loans or receives enough from them. Government loans are given on a financial need basis and have a limit. Use the Student Financial Assistance Estimator to see how much money you can receive from the Canada Student Loans Program. In the end, those who do not qualify and those who do not receive enough sign up for private loans.

With that being said, student loans are a great resource for your education, but try not to rely too heavily on them. Depending on how much you borrowed and the interest rate, it can take several years to completely pay off the debt. This can make it very difficult for you to achieve other financial goals.  Remember to be smart with your money and good luck!