Reduce Or Eliminate Educational Loans With Scholarships And Grants

When getting a higher education, many a student has to take out college loans in order to finance the entire process. Then they fret over the next four or more years about how they are going to pay that loan back. Horror stories of graduates being in debt for years to come haunt the news media and rumor mills.

The simple truth is that if a student takes some common sense steps before applying for the loan, they can keep their costs to a minimum. Many of them are moves they don't teach in high school, but really should. That said, here are some very important ones.

Probably the first thing to do while in high school is to go to a bank and set up your own checking and savings accounts. While your parents may have to underwrite these accounts, make sure you are the sole name on the account. From there, use it wisely. Don't ever, ever, EVER bounce a check. Also, try to put away a few dollars every month, if not every week. Those who show responsible financial management before they apply for loans wind up with better interest rates when they get that loan.

A credit/debit card is another way to show financial responsibility. This means you use it a little, but pay it back promptly. Don't finance a winter trip to Cancun unless you can pay it back. If you use the card and pay it off promptly, you develop a credit record; and that will lower the interest rate.

Go to a respectable authority and find out what your chosen profession earns on the average. Now divide that annual wage by 52 weeks. Now figure out your monthly expenses for your own housing, food and daily expenses after you graduate. From there, ask the loan authority what your monthly payments will be after you leave school. If your monthly loan payment exceeds your weekly paycheck or what you have left after paying your basic expenses, it's too high.

Another very important thing many college students never do thoroughly is explore all alternative options of financial aid. There really are virtually thousands of internships, scholarships and grants out there. Not only do students never have to pay these back, they can reduce the cost of an on campus or online college to virtually nothing. And, the interest on nothing is nothing.

Try to finish your degree program as quickly as you can. The less time you spend going to school, the sooner you can get on to a job and really earn. In these tough economic times being a professional student is a very costly option, especially when it's time to start paying back those deferred loans.

Now the last tip is to stay on top of the latest college loan trends. When President Obama passed the Health Care reform act, he also greatly modified how college loans are administered. Not being aware of important information like this can mean thousands of dollars to your future.

Smart students will spend as much time as it takes researching scholarships and grants to see what they qualify for as this will reduce the amount of any loans needed. For students who are trying to work as they go through college, an online degree may be the way to go. Exactly the same as a traditional degree, these programs are becoming the degree path of the future.