As reported by Forbes.com earlier in the year, “there are more than 44 million borrowers who collectively owe $1.5 trillion in student loan debt in the U.S. alone.”
What does this figure mean for current students?
Approximately 70% of all college graduates leave school with student loan debt. Reasons for these high numbers have been attributed to the increased cost of tuition, housing, books, and other common student expenses.
Although it may seem impossible to graduate without some kind of debt, there are ways to minimize and even eliminate your student loans while in school.
In addition to choosing the right student loan for yourself, explore strategies for keeping your loan balances as low as possible.
Be responsible with your credit cards
In 2014, Nasdaq reported that the average credit card balance among college students was $499.
There are dozens of benefits to utilizing alternative finance options such as having a credit card – these include learning how to be financially responsible, having a backup payment method in emergencies, and spreading out expenses with an unpredictable income.
However, at any age, credit cards must be used properly in order to avoid unnecessary debt. If you do have a credit card, be sure not to put more on it than you can pay off.
This will allow you to dedicate more of your funds to your loans, and less toward paying off extra expenses that weren’t absolutely necessary.
Live below your means
College is a time filled with fun and adventure. Between buying college-branded items at the spirit shop to paying for the next big trip, it can be easy to overextend yourself financially.
Although it is wonderful to take advantage of the exciting opportunities you have while in college, spend most of your time living below your means.
If you make $500 per month at your part-time job, don’t make it a habit to spend all (or more) than that. In fact, work toward living off of as little of your income as possible.
Dedicate the paychecks from one part-time job to tuition
If your situation allows for it, use the paychecks from your job (or from one of your jobs) to pay tuition.
An extra $200-$1000 per month over the course of your college career will go a long way toward reducing (or even eliminating) the amount you’ll owe by graduation.
If you use your current paycheck for necessary expenses, consider getting a work-from-home position online (such as a virtual assistant) to bring in extra cash.
Continuously seek out scholarships and grants
The search for scholarships and grants shouldn’t end after your freshman year.
In fact, there are many scholarships and grants that are only given out to juniors and seniors.
Explore nationwide opportunities online, and work with your school’s professionals to find which school-specific funds you are eligible for. Even though you may not receive additional funds, just one grant or scholarship can eliminate thousands or even tens of thousands from your loan balance.
Leaving school without student loan debt may seem like an impossible task. However, by following the strategies listed above, you can significantly reduce (or potentially eliminate) the funds owed upon graduation.