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Jun 24

How Much Should You Borrow in Student Loans?

Reading Time: 3 mins

If you’re thinking about going to school to continue your education, the idea of loans will come up at some point. It’s usually wise to explore the available options before you make any important decisions. The following is some information about loans and how you should choose how much to borrow.


Evaluate Non-Loan Options

The first thing you should do before choosing undergraduate student loans is to research and evaluate your non-loan options. Options such as grants, gifts, and hard-earned money are available to you. You should check those avenues before you start exploring loan options.


Determine How Much You Can Earn

As mentioned earlier, you can earn some of the money you need for your schooling. Therefore, you should sit down and think about how much you can earn by working a second job, selling items you no longer need or doing odd jobs. Add that to the number of available funds you can use for your learning experience.

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Set Up Your Budget

The next thing you’ll need to do is set up your budget. You need to know how much you can afford to pay back on any student loan you obtain. You don’t want to make it too difficult for yourself. Therefore, you must leave yourself with enough disposable income to ensure that you can relax in life.


Figure out How Much to Borrow

You’ll need to figure out next how much you need to borrow. It’s easy to do that by talking to the prospective school and getting a price on the tuition. Once you get a price on the tuition, you can then go ahead and subtract all the money you can get from your non-loan sources. That will leave you with the figure that you will need to request in your loan application.


Factor in Future Income

It’s okay to factor in your future income if it’s solid. That way, you won’t have to apply for as much money in the loan product as you think.


Decide on the Type of Loan

You must take the time to carefully evaluate your options in terms of loan type, interest rate, and additional fees.

According to Ascent, for example, “Ascent offers award-winning cosigned and non-cosigned loans for college.”

You should also compare lenders before you obligate yourself to do business with any particular provider. Shop around and thoroughly do your research to make sure you’re getting the best deal for you.


Assess Repayment

Finally, you’ll need to assess the repayment terms of your loan. Your advance might be super-large. You’ll need to know exactly how long it will take you to pay the loan proceeds back and the exact amount of interest you’ll need to cover. You’ll also need to know how much your monthly payment will be. That’s how you’ll know which loan product will work best for your unique situation. The perfect educational loan is available to you. You just need to research, reach out and grab it.


Now you have a good strategy for getting the loan you need and deserve, it’s time to start looking for the right financial products for yourself.


Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.


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