Student Loans

The student loan is part of almost every financial aid package for college and graduate school. Higher education is extremely expensive and almost no one can afford it without some type of financial assistance. Because they do not need to be paid back, there are not usually enough grants and scholarships to go around. That is where student loans come in.

Most student loans are backed by the federal and/or state government. They will need to be repaid, with interest, usually starting six months after you graduate or leave school. For this reason, it is recommended that you pursue additional options to fund your finance major, such as grants, scholarships, and personal savings, and not rely on student loans completely, if possible.

The first step to getting federal student loans is to fill out the Free Application for Federal Student Aid (FAFSA). If you are a new student of higher education, indicate all schools to which you have applied and/or are still considering admission. Returning students need only indicate the school they are attending. FAFSAs are accepted beginning January 1 and the submission deadline for many colleges and universities is March 1. They are considered on a first come first served basis, so APPLY EARLY! It is better to submit the FAFSA early with estimated income from the previous year than wait until your tax return is completed, give exact numbers, and submit it later. You can amend the numbers once the FAFSA is submitted, if necessary.

Once your FAFSA is reviewed, you will be awarded a financial aid package. This package may consist of grants, scholarships, other types of financial aid, or a combination thereof. You will need to indicate your acceptance or declination of each individual piece of your financial aid package. For example, you can accept a grant but decline a loan amount. An expected family contribution (EFC) will be calculated based on your family's income from the previous year. If there are mitigating circumstances that may not be immediately apparent in your application (for example, if you are expecting a sharp decrease in your family's income in the next year due to prolonged illness or injury of the family breadwinner) indicate that on your application. If you need help doing completing your FAFSA your university's financial aid office should be able to assist you.

The student loan process is not perfect, but it has helped make a college education become a reality for many people who would have otherwise found it unattainable. It may be just the thing you need to put a finance degree within your reach.

Last Updated: 06/08/2014

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