Rule of Thumb for Student Loans

According to Forbes, there is about $1 trillion of student debt in the United States. We all have a dream school that we would like to attend because we tell ourselves that it’s what is best for our major. However, sometimes the school doesn’t matter. You can create your own dream school in almost any school you attend. So why take out so many loans that will take you a lifetime to repay?

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A good rule of thumb when looking at tuition costs is to find a school that will not require you to take out more loans than the annual salary you will be receiving the first year of your career. I, personally, went for an even cheaper option than what my expected salary is predicted to be. Some people are able to go to a more expensive school if they decide to pay for tuition with their current job wages and then take out loans based on the rule of thumb I have mentioned.

If you still want to attend your dream school despite the fact that the loans you will need to take out exceed your predicted salary, here are a few other ways you can save money while in school:

  1. Community College/Two-Year College: At Transfer Ways, you know we are all about transferring after completing a year or two at a college. Whether you decide to attend a community college or a private two-year college, you will still be saving more compared to spending all four years at a university.
  2. Live at Home: This may not be an option for you if you prefer to venture away from your hometown when it’s time to start college, but living at home is a huge money saver!
  3. Shared Housing: This is not the ideal option, but it is a better alternative if you wish to move out of your parents’ home. Why pay a full month of rent when you can pay about half the price (or even less should you choose to live with more people) for rent?
  4. Scholarships and Grants: These can really help you transfer into your dream university if you do enough research (hopefully more research than I did!). There are so many resources available online through college/university websites, Google, government websites, or you can even ask an advisor at your current or future school for assistance.

At the end of the day, you will be the one who has to pay off your loans (unless you’re blessed with extremely generous parents). I hope this post helps you make the right decision when looking into universities and transferring.

Look out for my next post with advice on how to make any school your dream school

– Alena Y.