Hello! I received my financial aid package from my safety school. The cost of attendance is around $57,000 and the financial aid package they gave me is around $59,300 each year. But I have to take out around $35K in student loans without any interest rates. I am planning on going to the college because it is an amazing aid they gave me, but I am contemplating on whether I should take out the loans and use the extra $2300 in my personal expenses, or if I should use the extra money for my college tuition instead of taking out the loans. The loans I would take each year will add up to give me $14k in student loans in four years. Is it safe for me to take $14k in student loans?
*3,500
Sorry about that…lol
Honestly, I would take the loan the first year if you are only going to have 14K in loans for four years. Put it in the bank for an emergency fund. You will have expenses like books, food (snacks, meals not on your meal plan), travel home for Christmas, shampoo, laundry detergent and laundromat expenses. Lots of little things will add up.
If you don’t use your emergency fund, you can skip the loan in year two.
I am confused. You say you have to take 35K in loans and then you mention 14K. Which is it?
It was a typo – it looks like the financial aid package includes a $3500 direct subsidized loan this year. The OP is thinking that will be the same for all 4 years (so $14K in all), but more likely it will track federal lending standards and be $4500 in year two, $5500 in years 3 & 4— so $19K in all. OP said “without any interest rates” but probably just means that the loans are subsidized – so -0- interest now, with interest kicking in after graduation.
To the OP: You can accept the loan now but change your mind and refuse them at the time of disbursement. The disbursement is broken up by semester-- so you would get a $1750 loan in the fall, $1750 again in the spring. So you can go ahead and work over the summer, and if you earn enough that you don’t think you need the loan, just turn it down in the fall.
Although there is no interest while you are in college, there is a small fee when the loan is dispersed.
That amount in loans is okay. Based on what an average college graduate can expect to make, you should be able to pay that off over five years or so.
$3500 a year in loans? That’s it?
All other costs are covered? Nice package.
Does this include Work Study? If so, remember, you won’t have THAT money until after you earn it from working at a job. And if your total package exceeds the billable costs…you won’t get a refund until we’ll after classes start.
Just make sure you get a job…now…and have start up money for the start of the year.
Sounds good! Which college…if you don’t mind sharing!
@thumper1 , It does not include work study.And sorry but I don’t feel safe sharing the college’s name.
All costs are covered and I have an extra $2300 because I received more money than the total cost of attendance.
Sounds like a great award.
Technically, you didn’t receive more than the cost of attendance. You received more than the total costs directly billed by the university. You will have other costs not on your tuition and dorm bill in order to attend, and emergencies will certainly happen (maybe your laptop dies or you have a medical issue or something). If you don’t have a savings fund, I would use this small loan to start one. If there’s 1000 left at the end of the year, that’s awesome, and you can borrow less next year.
He actually might have gotten more than the COA if he is Pell eligible. Some schools give their generous awards, and don’t use the Pell to reduce other aid. And since the Pell is an entitlement…the student gets it.
@thumper1 ,What you said was on point: I am Pell eligible. Can I take the loans for first year and not take it my second year? I don’t know how school loans work in the U.S.
You can decide each year if you want to take the loans.
Moreover, you have to apply each year for renewed funding. Get that FAFSA (and Profile if required) done every winter break! (It will probably won’t be due until sometime in February, but over break when you’re not distracted by classes is an excellent time to do it.)
The school says I have to take $3,500 in student loans, can I take less than that because $3,500 is too much for me? Is $3,500 the maximum amount of loan I can take or does it sharp $3,500?
** does it have to be sharp $3,500**
You don’t have to take the loan; a school can’t make a loan mandatory. As a first year student, you can take up to a $5,500 federal direct loan, although not all of that will be subsidized.
You can take whatever amount you like, up to $5500 ($2k will be unsubsidized). You can take it in the beginning of the year or at the end.
On your portal there will probably be a page to accept financial aid. Some things, like Pell, will be ‘accepted’ for you because everyone takes those. Loans will either have an ‘accept’ or ‘decline’ box to check, or sometimes a box where you can put in a different amount.
If you don’t understand the aid, go talk to someone in the financial aid office.
You can adjust the loan amount. Sometimes you can do it yourself on your financial aid portal and sometimes you have to call and ask someone to adjust it for you. If you can’t figure it out, ask the financial aid office.