Features

Tips for Calculating College Costs
Between rising tuition costs, stagnant wages and savings and a weak jobs markets, paying for college has become a daunting task for most families and students.

College Street Sign, PF

Repaying loans after graduation can be a knee-knocking endeavor. Here are tips to create a solid, efficient repayment plan.

College Professor Lecture, 640x360

Find an Advisor

Before taking out loans, talk to an expert or someone with experience managing money to calculate how much money you will need to borrow. Then before graduation, talk to an advisor (many colleges offer them for free) to create a repayment plan.

Reuters

Chile_Students_3_FNL

Finance Your Education, Not Your Lifestyle

Borrow only what you need, you do not need to be paying interest on frivolous expenses that will cripple your lifestyle after graduation.

AP2011

College Exam iStock

Look Down the Road

Plan based on future expenses and lifestyle choices. Living in the real world means many added costs like car and house/rent payments--not to mention food and entertainment costs. Remember the bank of mom and dad tends to close upon graduation.

College Loan Empty Piggy Bank

Understand Loan Terms

Don’t sign on for a loan that you don’t understand. Be sure to read the agreement, identify the re-payment terms and find out exactly how much you will owe and when you will be expected to start making payment.

College Graduate, Hire Me

Don’t Overestimate Earning Potential

The Department of Labor can help you predict possible salary first year out of college, it’s best to borrow less than that to finish your degree.

Reuters

College Student Stressed

Understand Your Debt-to-Income Ratio

Use Sallie Mae’s Education Investment Planner  to calculate your total monthly debt payments as a percentage of what you earn every month (or expect to earn upon graduation). This will give you an idea of how much you will need to earn and how much to take out in loans. Sallie Mae offers the following rule of thumb: “Your student loan payments are likely to be manageable if they are 10% or less of your starting salary.”

Reuters

Loan Co-Sign FBN

Look for Free Money First

Sallie Mae recommends looking for money to finance college in this order, college savings and scholarships, federal loans, and private education loans as a last resort.

Tips for Calculating College Costs

Between rising tuition costs, stagnant wages and savings and a weak jobs markets, paying for college has become a daunting task for most families and students.

More From Our Sponsors