Tips for Managing Student Loans without Drowning You in Debt
Last updated: February 15, 2013 by Susan
The only way a single mother could better provide for her family is to get a degree, but that degree comes with a rather hefty price tag. Paying tuition upfront is quite impractical for most folks, which is why many turn to student loans to finance their education.
You do not, however, want to get suckered into taking out loans that you can’t pay off in the long run. Here are a few practical tips to help you better manage your student loans:
Pick out affordable colleges.
One of the biggest mistakes you can make is to believe that expensive colleges are the only way you can obtain quality education. Personal finance site Kiplinger has released a list of public colleges that provide the most bang for your buck, so you may want to check it out before going to expensive for-profit colleges in your area.
Mix and match your education.
If you really want to save cash, then you can go to community college for a few years before moving to the campus of a bigger university. You can also do the same with certificates in technical or vocational schools. Just make sure that the university you want to get into will recognize the credits earned in these institutions.
Use 529 College Savings plans.
These nifty state-backed plans waive all taxes – federal and state – on savings as long as the money will be used for higher-education. That means you can put your hard-earned money in a 529 plan without your local state or Uncle Sam taking a bite out of it in the long run.
Go for federal loans.
Always, always fill out the Free Application for Federal Student Aid (FAFSA) form. This may not only get you a straight-up grant from the feds, but could open up access to federal loans. These loans are much better than private loans thanks to their lower interest rates and full complement of “safety-net” features in case of financial emergencies.