Students must be wiser with their loans as the average student loan debt continues to rise. US News data reveals that the average amount of student loan debt of 2021 graduates reached about $30,000—even if the students took out $208 less than the graduates from the previous year. Graduates of private institutions actually borrowed about $31,820 on average, while public college graduates took out about $26,320.
The average loan debt of Americans is more likely to increase in the next few years, which is why it’s helpful for students to find ways to reduce the amount they borrow. If you want to find ways to lower your debt, here are some practical tips that you can do while you’re still enrolled:
Consider getting college funding aid
You can reduce the amount of debt that you’ll need to take out by applying to college funding programs. The “How America Pays for College” report by Sallie Mae states that many Americans actually combine income, scholarships, and grants with their student loans to afford college tuition fees. However, students can make their tuition fees more affordable by applying for college funding programs, like the Free Application for Federal Student Aid (FAFSA). The FAFSA opens on October 1 every year, and it’s encouraged that you fill it out as soon as possible because some aids are awarded on a first-come, first-served basis. You should also apply to student financial aid programs in your local university to increase your chances of getting help.
Know your options for student loan forgiveness
It pays to know your rights when it comes to student loans. If you applied for student loans, take the time to learn about debt cancellation or forgiveness programs that may apply to your current situation. For instance, our resource on ‘Student Loan Forgiveness on Disability’ highlights that you may qualify for this if you have a mental or physical disability that has lasted or will last for five years. Keep in mind, though, that student loan forgiveness on disability isn’t issued permanently, so you should consider your current case if you’re applying under the Federal Direct Student Loan program.
Start a side hustle to boost your budget
One of the most popular options among students is starting a side hustle or getting a part-time job. An article on the gig economy by LHH even points out that many millennials sign up for freelance work to pay for their daily expenses and reduce their student loan debt. Gig work is also more suitable for college students because they can easily book a temporary job through apps like Facebook, DoorDash, Poshmark, or LetGo whenever they need money. Gigs are also pretty flexible, so students can attend classes during the day and then deliver food, DJ at parties, or tutor kids during their free time.
Reduce your tuition fee by adjusting your classes
You can cut down your tuition fee and any unnecessary expenses by reducing the number of classes that you need to take. ThoughtCo explains that graduating early can help you save on college expenses and get a full-time job sooner. One strategy that you can do is to take all available placement exams to minimize the college credits that you need to take. This strategy allows you to skip certain classes, thus reducing the total amount of debt that you need to take out. You can also take the maximum number of credits allowed per semester to save up on miscellaneous and living expenses.
Your student loan debt won’t reach $30,000, especially if you minimize the amount that you take out every semester. To learn more about how you can pay off student loans, check out our offers at Debt Strategists.