Only borrow what you need
You don’t need to borrow the full amount listed on your financial aid award letter. It is tempting to borrow a little extra for something you want and don’t need. When you borrow money, you pay it back with interest, increasing your total costs. A good rule of thumb is to only borrow what you absolutely need and no more. But also keep in mind you shouldn't borrow outside of your means to repay your loan
. Before you borrow, read over these strategies for responsible college borrowing.
Know the terms of your loan before you borrow
Rates and terms can vary widely. Explore your federal student loan options, including the Federal Subsidized and Federal Unsubsidized Loans (aka Stafford) before seeking another education loan. Learn more about loans.
Understand how interest adds up
It's easy to underestimate how much interest you will pay over the course of your repayment period. Use our loan payment calculator
to gain a better understanding of how much you will pay in interest on your loans and how it will affect your monthly payment amount.
Research your starting salary
Before you borrow, do your research on entry level salaries in your field of choice. If you expect to make $25,000 a year and you have $50,000 in student debt, you may have trouble meeting your monthly payments. Too many students have a “borrow now, deal later” attitude that ends up getting them into trouble early after college.
Use our calculator
to determine the max amount you should borrow for all years of college based on your career choice and geographic location. Also, compare the average salary of graduates at different schools using the College Scorecard
Think about your future goals
When deciding between two schools, you may find you want to go to one more, but it will mean you have to borrow a lot more. Think about how that will affect your ability to reach your future goals. Maybe you want to purchase a car or a house after graduation. Will you be able to afford to do so with a higher student loan payment?