It’s no surprise that the cost of college has skyrocketed in recent years, but did you know that 43 million Americans have student loan debt, with an average debt for a bachelor’s degree standing at $28,950, according to the office of Federal Student Aid? If you or a loved one is headed back to class this fall, we share some tips to consider before borrowing.

CONSULT YOUR FINANCIAL AID ADVISOR
One of the best resources for a student is your assigned financial aid adviser at the institution you plan to attend. This person understands the aid available directly through your university or college and can assist you when evaluating your options. These options could include work-study programs as well as institutional grants, which, unlike loans, will not need to be repaid upon graduation.

UNDERSTAND THE TYPES OF LOANS AVAILABLE
Subsidized loans are government-funded, need-based loans that do not accrue interest while you are still enrolled in school.

Unsubsidized loans are available regardless of your financial need, but these loans accrue interest as soon as the loan is distributed. Private loans generally have higher interest rates than government-funded loans, and those rates can be either fixed or variable. Private loans also are not eligible for participation in government repayment programs.

CONSIDER OPTIONS FOR REPAYMENT
Many students borrow without having a firm grasp on their potential for future income and their ability to repay their loans upon graduation. Prior to borrowing, analyze your future earning potential versus your anticipated total loan amount. Keep in mind that repayment is often based on your total amount borrowed. While there are options to apply for income-driven repayment and loan forgiveness programs, acceptance is not guaranteed, which could result in a hefty monthly payment.

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