Bailout Yourself--Tips for College Savings
By Kathryn Knight
March 23, 2009
Even though the bailout bill has been passed, most Americans are still wary of future financial woes. Students are especially worried, seeing as their funding for college is tied up in private loans and may have been affected by the recent sub prime mortgage crisis. Mark Kantrowitz, a leading financial aid expert, has a few tips to help students continue to save for college:
Minimize Debt. Borrow more than your expected starting salary and expect to use extended payment, which increases your overall borrowing cost.
Borrow Federal First. Federal loans are cheaper—the interest rates are fixed. Federal aid is also more available and easier to repay.
Submit the FAFSA. Enough said.
Search for Scholarships. Use FastWeb.com to find scholarships that you qualify for.
SAVE for College. The more you save, the less you have to borrow. Open a 529 savings account.
Talk to Financial Aid. They are a great resource for help with money. Not only can they provide, but they can also direct you to more.
Tuition Installment Plans. Be sure to explore payment plans. Different payment plans allow more accessibility for your financial situation.
Cosign with Credit. When applying for private student loans, have a creditworthy cosigner to help—overall, it lowers the cost of the loan.
Pay Up on Interest. Try to pay interest on your loans while you’re in college.
Target Private Loans. Private student loans are oftentimes the most expensive—get rid of these first.