How to Avoid Student Loan Debt

Student loans are a way of life for college students in America.  In 2014, the In 2014, there was approximately $1.3 trillion of outstanding student loan debt in the U.S. that affected 44 million borrowers who had an average outstanding loan balance of $37,172.  If you have any hope of financing a car, getting a decent credit card, or even renting an apartment after college – you need to graduate college with as little student loan debt as possible.  Here’s how!

Save your money as early on as possible

By saving your cash before and during college, you can help to repay those loans much more quickly once they become due. Get a part time job, have a yard sale, or begin a savings account so that you will have extra money to pay off the loans and payments that will quickly accumulate.  All parents reading this should be advised: if you haven’t started setting money aside for your student’s educational expenses, you need to start – now!

Take your time, and don’t be in a hurry

While everyone wants to graduate and get a new career as soon as possible, it is important to keep in mind that the longer you’re enrolled, the longer you can put off repaying those loans. Try out part time school, and work part time if you can. While this method won’t work for everyone, it can help ease the stress of being a full time student while allowing you to earn money and get a jump-start on paying back your loans.

Avoid private schools and for-profit education

Private schools have their advantages.  Small classes.  Small student populations.  Attentive faculty.  A lot of one-on-one time.  But, given the baccalaureate degree isn’t the ticket to career success it once was, private schools, while they offer legitimate degrees are, also, a questionable investment.  So many baccalaureate degrees have been conferred, that it’s almost a given everyone will have a B.A. or a B.S.  Having one no longer sets you apart from the rest of the workforce.  Please, don’t spend $30,000 a year in private school tuition because you think the name will be a cinch to land a graduate their dream job with a monthly pay check that will pay for a nice house and the obligatory white fence their first year after they here Pomp and Circumstance.  While in many ways, this concept is still true in the Ivy League where career services focus aggressively on job placement; it’s simply not the case.  If you’re paying more than $5,000 a semester in tuition and fees for a student’s undergraduate career, you’re paying too much.  Any dedicated faculty in a large state research or teaching institution will provide the same experience as a private school.

Get as many scholarships as you can

The difference between loans and scholarships is that you won’t have to pay those scholarships back. There are literally hundreds of different types available, so look into these as soon as possible. The more you are awarded, the less money you’ll have to dish out to student loans. Even if you earn a couple of smaller scholarships, every little bit helps to whittle down that student loan balance.  If you don’t have time to find and apply for scholarships yourself, pay someone who knows what they’re doing to do it for you.  It will pay off in the long run.  Cast a wide net.  The more you apply for, the more chances you have.


In the United States, until you are over age 21 and a half, your financial aid options are based on your parent’s income.  If your parents earn a lot of money, you may not qualify for need-based aid.  If your grades aren’t good enough, you won’t qualify for merit-based aid.  This means you’ll only be eligible for student loans.  Once you turn 21 and a half, you are considered independent by the Department of Education, and you’ll have grants and scholarships available to you based on your low-income status you didn’t previously.  Get a job, save some money, put off school.  But, be careful, the longer you wait, the less likely you are to start!

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