If your family
is like many, chances are you’ll need to finance at least some of your college
costs with a variety of college financing solutions. Making a plan before you
borrow may help reduce the amount you’ll repay with interest. Consider making a
plan for all the years the student and any additional children will be in
Many families use a combination
strategy of past income (savings), present income (interest-free monthly payment
plan), and future income (student loans for college) to cover college costs and
minimize borrowing. Many colleges offer interest-free monthly payment plans that
allow you to split your bill into smaller, more manageable payments over 5–10
months. This is an excellent option if you don’t have the resources to pay your
bill as a lump sum. Plans generally begin in June and may require a minimal
enrollment fee. Contact the college bursar’s office for more
People Fund Higher Education Expenses
Learn more about paying for college and managing your money while
you're a student.
Before borrowing for college, consider
federal student loan options, especially the Federal Stafford Loan for students.
These student loans for college have some of the best terms and repayment
options for students. Talk to your college or university if you’re interested in
borrowing a federal student loan.
If you decide to borrow, shop
around for the best student loan for your needs, and be sure you understand the
basics about student loans:
loan advertised as a student loan for college may still require a
co-borrower. Many of these loans also charge
a higher variable interest rate.
A co-borrower is equally as responsible for a
student loan as the primary borrower, in
most cases. Many traditional private education loans require a co-borrower. Make
sure all borrowers on the loan understand how the loan will be repaid, and keep
all addresses and contact information current.
Deferred student loans will cost
more than immediate repayment loans. Your
monthly payment may be lower by borrowing an immediate repayment education loan,
and the overall cost will be significantly less.
Variable interest rate loans will
likely increase as interest rates begin to
rise in the economy. Most fixed interest rate loans charge the same interest
rate and monthly payment for the life of the loan, regardless of changes in the
print matters! Student loans aren’t one size
fits all, so be sure to research and ask questions to help you decide which loan
product is right for your financial situation.
Download a tips sheet, including our Education Loan Comparison