Planning Tips to Help You Pay for Your College Education

While heading to college is a great adventure, the cost of college is sky high. Whether you’re still in high school or planning your enrollment at a state public school or a private college, read on to see what you can do now to be able to cover your college expenses.

Tip #1: Get your finances in order

To get where you’re going, you need to know where you are. If you’ve already chosen a school, get a detailed annual cost estimate and compare it to your existing savings, income and budget. If you haven’t picked a school yet, understand the potential cost differences between community, in-state and private schools. If college is still several years away, factor saving into your monthly budget.

Tip #2: Look for loans

No one wants to start off with student loan debt. But sometimes it’s the only way. First, make sure you have a college savings plan that allows tax-free withdrawals. Then, see if there are gaps in your college fund and look for student loans that can help bridge that gap.

Tip #3: Get a head start

A gap in funding happens when federal student aid and scholarships don’t cover all your college expenses. Fill out a FAFSA application for federal student aid. To cover the gap, ensure you apply early so you don’t miss your school’s deadlines.

Tip #4: Look into private student loans

Private student loans are for when federal student loans, grants, savings and scholarships don’t cover all your qualified higher education expenses. Applying for these loans is easy, at Navy Federal, a student loan takes less than 15 minute and you don’t have to repay private student loans right away. Students with Navy Federal loans have up to five years before they have to pay back their loan in full. Private student loan distributions aren’t subject to income tax, but they do have tax benefits that can save you interest on your federal income tax.

Tip #5: Get a Cosigner

Lenders want to know you can handle repayment before giving you a loan. A parent, other family member or even a friend with good credit can agree to back your loan. Having a cosigner may even help you get a student loan at a lower interest rate.

Some lenders, like Navy Federal, will release your cosigner after you graduate school and make 24 on-time payments in a row. 

Tip #6: Borrow the Right Amount

You may not know what all your college expenses will add up to, so it can be hard to know how much to borrow. Base the amount of your student loan on the cost of your school’s attendance, which includes college tuition and college expenses like fees, books, computers, meals, travel and housing.