The vast majority of college students take out a mountainous sized load of loans in order to pay their way through school. Is it worth it? Some say yes, while others, who are in the early onset stages of gray hair due to the financial stresses, wish they had never attended college. When asking yourself whether or not you should take out ANOTHER one since you will have an opportunity at the beginning of every year to decide, try and factor in a few things. First and foremost, whether you are driven and care about the focus of study you are involved in. It has been said that if you hold a passion for something, you will find a way to overcome any obstacles in the way of pursuing whatever that might be. If it means working at a job you do not like for a few years and only leaving an hour or two a day after work to focus on what you love, then so be it. On the other hand, if you are just coasting through that not-really-applicable-to-anything major and will pop out of the school’s womb still hungover from the night before, life’s gonna be waiting with its fist clenched to hit you pretty hard. A mentor of mine met me for lunch once and spilled the beans on how he got to where he was, owning a small and very successful company that had made him and his family wealthy. It all started when he evaluated whether or not he should have really been in college when he was, and dropping out after freshman or sophomore year. Initially, things were obviously tumultuous, but he just started working and figured things out as he went along, and everything came together. Despite the existence of successful college dropouts, (there’s more than you think) most of you reading this will stay and take out loans, so let’s talk about the two types a little bit. Also don’t just drop out of college cause like, degrees are good and stuff.
- Subsidized- the good old government pays your interest while you are in school. That’s right, the old folks in the White House. When loans are at 6%, that’s a pretty big deal. You do need to qualify for that, however, and if you are not familiar with the FAFSA or applying for financial aid, please acquaint yourself here. That form will determine your eligibility.
- Unsubsidized– The mother ship forgets about you, so tough stuff you’re on your own with the interest. Make sure you have a campus job or some money from the parents to cover it.
These are your two types of loans in college that everybody and their brother complains about having to pay well into their late 50’s. Because they wanted to do this, that, and the other thing straight out of school instead of sending their loans to the graveyard, they paid the price when interest accrued and accrued. So if you do take a lot out, for your own good plan on living at home the first year or two out of school and pumping that new job’s income straight into eliminating those financial weights.