Hey guys, as with most people, my parents will not be paying for my college. Their income is just not high enough to support a full time college student. Fortunately, I received some financial aid but I did not receive any other scholarships, even though I applied to a lot of them… :-w
Anyways, I will probably be taking out loans to pay for Tech. I will need to take about $10,000 in loans every year and by the time I graduate, it will accumulate to $40000+. To any experienced people out there, is $40000 in loans too much? I ask this because the average amount of indebtedness for graduates is about $27000.
Just as an fyi, if you’re an incoming freshman, you can only take out $5500 in federal loans (then $6500 sophomore year, and $7500 per year for junior and senior year). If you require more than that you’d have to go to a parent loan (aka your parents will have to sign up for it) or private loans (and if you’re 18 with no credit, you’ll need a cosigner, again probably your parents). How do you plan on getting $10,000 each year?
If you’re a engineering major or a few select majors outside of engineering, $40,000 of debt isn’t insane. If it’s anything in liberal arts, I would say it’s too high. I personally prefer sticking to the loans offered by the federal government since the interest rates are low and they offer a grace period, deferment, and reasonable payment plans.
As said above you can only take $5500 yourself. Anything more will have to come from a Parent Plus loan which they cosign with you. If they are denied the loan you are offered an additional $4000 in your name.
I would recommend that you work as much as possible this summer. You should be able to earn $3k-$4k. You might have to work two jobs because most places won’t give you 40 hours a week. You should also work 10-15 hours a week in college. Try and borrow as little as possible. Here’s a tool so you can figure out the future payment:
Some other tips to make money/lower your costs: You may not be able to get a high paying job this summer, but your sophomore year (especially if you happen to be engineering) you can get a decent paying internship. I know someone who got a $19/hr, 40 hr per week with housing including. I was a psych major and got a $17/hr, 35 hr peer week internship in NoVA and just stayed with relatives in the area to save on housing. So you could make the above amounts pretty easily if you’re proactive and secure an internship.
Also, after your freshman year, you can move off campus and save on housing. If you search early with roommates, you could secure a place for $300 per month. I’ve even seen rooms in apartments going for $275 - just don’t go with the big rental companies. That would cut your housing cost to less than $4000 per year.
You also don’t need to get a meal plan after you move off campus. You could work in a dining hall if you need part time work, and each 4 hour shift comes with a meal in that dining hall.
There are also some jobs around campus that pay $10-$12/hr. Further off campus, I know of a place that hired pretty often that paid $15/hr for 16-20 hours per week.
Thank you so much for the information, and @financiallylost, I got 8k from fafsa in the form of grants. Also, I’ve heard that the amount of grants from FAFSA decreases as you go from your freshman year to sophomore year and from your sophomore year to junior year. Is this true?
@mythbloodpk Not necessarily, it mostly depends on each individual’s family income and EFC.
My and my sibling had about the same EFC for all of 4 years. Our Pell Grant increased each year because the government raised the max amount. My state grant was the same for the first two years, then decreased by $400 in the third year, but stayed the same for senior year. My sibling had a large state grant for freshman year, but that was cut in half for sophomore year. Aside from that, they did not get less in grants during any other point in their 4 years.
We both got two university specific grants starting sophomore year, Funds for the Future and the Virginia Tech Grant. These grants are distributed only to returning students and they increased slightly year to year. We both got a few hundred dollars more per grant each year.
Be a co-op student. You’ll have job experience when you graduate…and maybe a job offer from your employer.