<p>Since people base how much debt is too much on your starting salary I will start by telling you that I am planning on getting a degree in Economics from UMDCP. </p>
<p>I am a freshman and before I go on with my college career I want to get some advice on how much debt is too much.</p>
<p>This year I have taken out 2 private loans for $6,000 and $5,000 with a 10% and 9.75% interest rates respectively. Plus I was given a $5,500 loan from the government with a 6.8% interest rate. I think it is the Stafford loan.</p>
<p>For some reason it has been difficult to get scholarships as I applied for many and only got a few for my freshman year. My parents don't have the money to help pay due to tough times and for some reason FAFSA won't give me the appropriate aid. So here are my calculations for total loan amounts that I will have to take out while in college 4 years:</p>
<p>Freshman: $6,000 (littler higher than 10% rate), $5,000 (9.75%), and $5,500 (6.8%)= $16,500
Sophomore: $6,500 Fed. loan, the probably around $11,000 worth of private loans with an interest rate around 9%. Total: $17,500
Junior: $7,500 Fed. loan, and then again $10,000 worth of private loans with around 9% interest rate. Total: $17,500
Senior: Same as Junior year. So another $17,500</p>
<p>So the my total debt would be around $69,000 with varying rates between 6.8% and 10%. </p>
<p>Is this too much debt? Is it worth it? Any advice would be greatly appreciated since I don't really have anyone knowledgeable about college tuition, fees, and debt to get advice from. Thanks</p>
<p>First…don’t blame FAFSA.It’s an application form. It does not award financial aid. The colleges award financial aid. The FAFSA is used primarily to determine the awarding of federally funded need based aid. This would include the Pell grant (If your FAFSA EFC is below $5400 or so), the Stafford loan, the Perkins loan (usually awarded to lower income students), and work study. UMDCP is a public university. They award mostly federally funded need based aid…and I know they award some merit aid but to very high stats applicants.</p>
<p>$70,000 in debt is going to cost you about $800 a month for about 10 years. That is a lot of money. No matter what your major is, you have no guarantee that you will secure a high paying job in the field. </p>
<p>Personally I think your debt is high but it sounds like you are an instate student and you are actually funding most of your cost of attendance through loans. Who is cosigning your private loans and will they be able to continue to do so for all four years? If you somehow secured these loans without a cosigner, will YOU be able to continue to secure these private loans for all four years.</p>
<p>What other options do you have? Are there less expensive schools within your state that you could attend? Can you reduce your costs by sharing a smaller apartment with more people, or commuting from home?</p>
<p>You are borrowing more than twice as much as you should. </p>
<p>That is toooo much debt. </p>
<p>$800 per month in student loan payments is similar to 2 large car payments. Newish grads do not earn enough to pay for rent, utilities, cell phone, cable, internet, clothing, food, fed taxes, state taxes, FICA and personal car expenses…PLUS 2 more car payments. </p>
<p>Are your parents co-signing these extra loans?</p>