Congratulations on your Student Loan DEBT… It has Increased!
Sunday, May 1, 2016

 By Porsche Miles-Grant

 
Did you know that the college graduates of 2015 made history by having the most student loan debt? In 2015, the average student loan debt totaled to 35k. In past years, student loan debt ranged anywhere from 26k-28k on average. However, with the increase in tuition and college expenses, education is even pricier than it’s ever been. Nevertheless, education is vital and necessary to enhance your standard of living. As young children, we have learned that the more education a person receives, the more money a person can earn. Some people are beginning to question this theory, making the claim that even individuals with a degree are in financial binds. Although this may be the reality for some, it is still more beneficial than not to obtain a college degree. 
 
Student loan debt is considered “good debt”. It has been said that student loan debt helps to increase your overall net worth and value. This is the kind of debt that you can make work for you. College helps to provide knowledge, experience, and a competitive edge to those who are willing to embrace it. A college degree speaks volumes, offering a different perspective on life. With a degree, a person is more marketable and qualified for the workplace. Yet, it is expensive. Here are some tips to minimize student loan debt:
 
1. Before entering into college, research the school and tuition. This will help you get an idea of how much you will need to attend college. Understand that different educational institutions cost more than others. Think about the cost of tuition for an out-of-state college/university as it compares to an in-state college/university. It may be more cost effective to start out at a community college and work your way into a bigger university.
 
2. Plan ahead. Preparing in advance will help you manage your expenses. Knowing ahead of time how many credits are needed for each semester will allow you time to save up money to assist with classes.
 
3. It is also a good idea to research the field you are most interested in, before actually enrolling into classes or solidifying a major. Researching starting salaries is imperative. See if the salary in the career you have chosen produces enough income to sustain your way of living, as well as pay off your student loans. Research shows that the average college graduate starts off making 26k-45k depending on their career field. It may be more advantageous to major in a field that would allow you to live comfortably. 
 
4. Before accepting financial aid, consider how much money you need to attend school. Compare that figure to what is being offered. If you are offered more than what you need, tread lightly. It is best to only take the funds that are needed. Remember, in the long run, you will be responsible for paying back those loans with interest.
 
5. Learn the difference between government (lower interest/fixed interest rates, and lenient payment options) and private loans (higher/variable interest rates, stricter payment options) as well as subsidized (government pays the interest while you are in school) and unsubsidized (the borrower is responsible for paying all interest) loans.
 
6. Review your promissory note before signing it. Read for understandings and know that this is a legal binding document that explains your obligations and expectations as it relates to your student loans.
 
7. Lastly, plan for repayment, save, and create a budget.
 
Porsche Miles-Grant is the Community Engagement Coordinator at CASE Credit Union. Contact her at 517.367.1001 or send an email to Pmilesgrant@casecu.org.  Log on to  www.casecu.org for more information.
 
This column was printed in the May 1, 2016 - May 14, 2016 edition.
 

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