How to Avoid Student Loans: 7 Tips Everyone Should Know
Student loan debt is at its highest rate ever: $1.5 trillion between 45 million borrowers.
In fact, U.S. student loan debt is now the second-highest consumer debt category, falling behind mortgage debt. Instead of finding yourself in debt, it helps to know how to avoid student loans altogether.
With these seven tips, you can set yourself up for success to avoid debt.
Don’t let student loans weigh down your future before you even get the chance to graduate.
Instead, use these tips to cover the costs as you aspire for a brighter future.
1. Don’t Wait
It’s never too early to start saving.
Whether you’re a parent or student, don’t wait until college to create a nest egg.
Instead, students should consider getting a job while they’re still in high school.
Then, they could put their earnings into a high-yield savings account.
As it accrues interest, they can maximize their savings before their college career even starts.
Head online to start your search.
You can find many online banks that offer interest rates above 2%.
Parents, on the other hand, can start saving from the moment their child is born.
For example, parents can open a 529 plan for their child. A 529 works similarly to a Roth 401(k) or Roth IRA. Over time, the account will accrue value, providing you with money to tap into when your child has educational expenses.
2. Excel in High School
As a student, it’s important to set yourself up for success before your college career begins.
High school is an exciting time in your life.
It’s also a great opportunity for you to get ahead.
Many colleges offer specific scholarships to students based on their grades and extracurricular achievements.
Make the most of your time as a high school student. In addition to maintaining good grades, you can also start working on acquiring college credits while you’re in high school.
For example, Advanced Placement (AP) classes can help you get a head start as a college student.
Some of the available AP classes include:
- Computer Science
- Foreign languages
- English Literature
Taking these classes while you’re still in high school can help you save money.
As a result, you’ll work on how to avoid student loans before you even graduate!
3. See the Future with FAFSA
You can also avoid taking out student loans by filling out the Free Application for Federal Student Aid (FAFSA).
The FAFSA is free, so any household can fill it out. If you’re trying to avoid student loans, make sure to complete a FAFSA, even if you think your family’s household income is too high for you to qualify.
Billions of dollars in financial aid go unclaimed by students each year. Instead of missing the chance to save money and avoid student loans, fill the FAFSA out as early as possible.
Different colleges have different deadlines concerning the FAFSA.
By filling the form out ahead of time, you can avoid missing out on the chance for free aid.
The FAFSA offers loans and grants. Grants are free money you won’t have to pay back.
By acquiring these grants, you can avoid future student loans and focus on your academic career.
4. Consider Community College
Many high school students dream about attending their dream college long before graduation.
A prestigious four-year college often comes with costly tuition fees, though.
Instead of completing your general education classes at an expensive university, consider going to a community college first.
Spending your first two college years in a community college will help you earn the necessary credits and save money.
Then, you can transfer to your dream college along with these credits.
In addition to helping you save money, attending a community college will also help you adapt to the transition between high school and college.
Completing these general courses will ensure you earn an associate’s degree or professional certification without breaking the bank.
You can even stay at home while you attend a community college to continue saving money.
5. Stay In-State
The number of Americans over the age of 60 who have student loan debt more than doubled within the last decade. Instead of falling in with this crowd, discover how to avoid student loans by remaining in-state.
Attending an in-state school can help you avoid student loans while you enjoy the comforts of familiar surroundings.
You can even stay in-state long enough to save money before attending an out-of-state university.
As a result, you can save thousands of dollars a year on tuition fees.
It can also help to attend a public university instead of a private college.
Before choosing a college, make sure to compare different tuition fees before you choose which university to attend.
6. Keep Applying
Once you start attending college, make sure you continue applying for student aid and scholarships.
That includes applying for FAFSA every year.
The more often you apply, the more likely you are to receive the help you need.
Your college might also offer their own scholarships.
Make sure to visit your institution’s financial aid office.
Ask them about any programs they offer that can help you cut costs.
Meanwhile, consider getting a job on campus.
Working on campus can help you avoid travel fees.
There are work-study programs you can participate in to earn money, too.
7. Cut Costs
There are many ways you can cut costs while you’re in college.
For example, consider living off-campus instead of paying for campus housing.
You can also cook yourself instead of paying for expensive meals.
Other ways to save money include:
- Clothes swaps or thrift store shopping
- Checking out library books
- Avoiding credit cards
- Setting a budget
- Taking a semester off
- Babysitting or side-hustling
With these tips, you can learn how to avoid student loans while making a little money, too.
How to Avoid Student Loans: 7 Tips for Making and Saving Money
It’s important to learn how to avoid student loans before you start college. Otherwise, you could find yourself drowning in debt.
With these tips, you can avoid taking out student loans and save money in the process.
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