5 Important Student Loan Mistakes to Avoid

Attending college is no longer a privilege afforded only to the wealthy elite – every student has the opportunity to expand their horizons, follow their dreams, and work toward a promising future in their chosen career by earning a college degree. Some students still need help to pay for higher education, and this is exactly why student loans exist.

When considering student loans, you want to make smart decisions that provide you the best opportunities to succeed now and in the future. The good news is that you’re not the first student to take out loans, and you can learn from the mistakes others have made. There are also companies that help you to refinance and lower your student loan debt repayments like this that assist recent college students who would like to pay less money each month to pay off their student loans.

Here are a few important student loan tips and mistakes to avoid.

  1. Missing deadlines

This is a biggie. Your student loan funds pay for tuition, books, and other expenses. If you miss deadlines, you could jeopardize your ability to attend college for a semester or more. It is imperative to make sure you know when deadlines are so that you can get all your paperwork in on time.

  1. Considering only a few schools

This might not sound like a mistake where your student loans are concerned, but the school you go to will certainly have an impact on how much you borrow during college. Many students assume that 4-year schools are the only option, or that they should only apply at the top schools for their intended major.

However, it’s always best to keep your options open. Even if you are eligible for money that would allow you to attend an expensive school, you need to think long and hard about whether or not to use it all. Perhaps attending a community college or state school in order to save money is in your best interest.

  1. Foregoing extra income

If you’re lucky, you’ll receive enough student loan money to pay for your tuition and other expenses. That said, if you have the opportunity to work during your time in college, you should probably take it. A little extra money coming in can help you to make ends meet and potentially reduce the amount you have to borrow.

  1. Spending loans on non-school expenses

Depending on the demands of your program, you may not have time to devote to a job. Luckily, your student loans may provide enough money to cover living expenses in addition to school costs.

You need to be responsible with spending, though. It’s one thing to use the money for food, rent, and other living expenses so you can focus on your studies, but you don’t want to take on debt for frivolous expenses like eating out and spring break trips.

  1. Failing to understand benefits

Student loans are what is known as good debt, meaning the payments you make improve your credit score. Federal loans also have low interest rates and you may be able to deduct the interest on your taxes. This is all good news, but if you don’t realize the benefits you gain from taking on student loans, you might make mistakes like refinancing that could end up costing you in the long run.