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Create a Budget
A budget is the most important tool you can have while you are in school. It
is a framework for living within your means. In order to create a
realistic budget, you must first assess your current lifestyle and spending
habits. You must also recognize that, more than likely, these patterns will
drastically change when you become a full-time student.
You should start by itemizing your basic
monthly living expenses, such as rent, utilities, food,
clothing, laundry, transportation, and entertainment. A monthly budget is
preferable to semester or yearly budget because it allows you
to assess both your short-term and long-term expenses.
The next step is to itemize your financial resources, such as parental/family
support, savings, and part-time work income. Now you should be able to
compare your projected
monthly expenses to your projected monthly income, assessing your need (if
any) for student loans to bridge the difference.
Only Borrow What You Need
Unsubsidized
student loans begin to accrue interest when you receive the money (at disbursement), so you can
expect to repay more than the amount you borrow.
The following tools will help you calculate your monthly loan payments. They are only recommended as resources and should not be used to yield true repayment figures.
Monitor Your Debts
It is critical to consistently monitor your loan debt while in school
to have a realistic understanding of your financial obligations once you
graduate. Check your loan history
online,
or visit the National Student Loan Database System
to find record of all your Federal loans.
Avoid Using Credit Cards
Credit cards are tempting, particularly for students on limited budgets. If you're planning to use them, use them responsibly. A negative credit history will jeopardize your ability to secure
a mortgage, a
car loan, or other lines of credit in the future. Consider these tips:
- Reserve credit card use for emergencies only
- Limit yourself to one card
- Avoid impulse purchases
- Pay your balance each month to avoid interest charges
- Send your payment well in advance of the due date to avoid late fees
Maintain a File
It is highly recommended that you create and maintain a file of all financial
paperwork. This file should include
copies of all applications, promissory notes, lender correspondence, disclosure
statements, and any other important documents.
The debt management information on this page is provided solely as a guideline and is
not intended to serve as professional financial advising.
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