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Even after all the scholarships, grants, and federal aid, your college costs still may not be fully covered. Many students have to take out student loans to afford their college education. That also means having to spend years after graduation paying off that loan with interest. But with some thought and planning, you can minimize student loan debt at least a little.
Here are four things you can do to minimize your student loan debt:
Apply for as many scholarships and grants that you qualify for
Scholarships and grants are essentially free money. You don’t have pay them back nor do you have to worry about any interest accruing. The more money awarded through scholarships and grants, the less you have to take out in loans. This is the single best thing you can do to minimize student loan debt. And be sure to file the FAFSA as soon as you can. Filing the FAFSA opens you up to institutional scholarships and grants, as well as federal financial aid. Not only that, a lot of outside scholarships require you to file the FAFSA to become eligible.
Consider refinancing and/or consolidating your student loans
Financial situations change, especially after you graduate from college. You’ll need to be able to adapt. Refinancing involves taking your student loans and essentially getting a new one. Basically, a private lender takes your loan and gives you a “new” one with different terms and interest rates. Consolidating student loans means combining all your student loans into one loan. The interest rate is the average of all your original loans. Both refinancing and consolidation changes your payment plans and interest rates—potentially lower interest rates or lower monthly payments. Switching things up may benefit you in the long run, especially if you’re struggling to keep up with monthly payments currently. However, if you choose to refinance or consolidate, you end up losing any perks that come with your original loans.
Earn money freelancing in your area of expertise
There is a huge demand for freelancers in almost any medium you can think of, from writing and graphic designing. to web designing and photography, and more. With freelancing, you take on only as much work as you can handle for the week so you can still keep up on your school work.
Pay the loan interest whenever you have any extra money
You don’t have to wait till after you graduate to pay back the loan. The small interest amounts you pay while you are still in school will reduce your student loan balance considerably in the long run. Each month, pay back as much as you possibly can, but don’t just automatically do the minimum. Even if you only manage to pay off the interest, that’s still a lot of money that you’ve shaved off your debt. Of course, only do this if you comfortably can.
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