Are you still paying off your student loans? Do the piling mounds of debt from your student days still haunt you? Well, you aren’t alone. The U.S. has almost $1.6 trillion worth of student loan debt, the second-highest after mortgage! This means, on average, eight out of ten people are still paying off their student loans well into their 30s!
Huge amounts of debt and a volatile job market result in many people filing for debt settlements or even bankruptcy. However, there are several dangers of debt consolidation, and you should be ultra-careful before opting for these services.
Several discussions are happening amongst the policymakers to find out what seems to be the root of this problem (and possibly bring some relief to students across the country). You can try your bit to make life a lot easier for yourself and your parents by following these simple financial planning tips.
Tips to Manage Finances to Avoid Bankruptcy Early in Your Life
Make Saving a Habit Early On
One of the best parts of being a high school student in America is that you can work part-time. Unlike many other countries where children don’t even think of working till they graduate from college, American youth have a head start in this area. But, how well you utilize your earrings is rather questionable.
So, start saving a part of your earrings (or allowances) right from your first paycheck, and soon you’ll realize that you’ve saved a part of the college down-payment by the time you fill out applications.
Try to Ace High School
Even if it sounds like a buzzkill, if you were a good student in high school, it will surely pay off in the long run. Almost all colleges offer scholarships and fee waivers based on your high school performance in academics or extra-curricular.
But that’s not all. Most high schools offer extra credits to students who excel at one or more areas depending on how well you choose your AP classes (computers, foreign languages, art, music, sciences, history, etc.). AP classes from your high school directly translate into college credits, so make sure you plan ahead and choose these subjects in sync with your dream college.
Don’t Miss Out on Federal Aids Like FAFSA
Even if you and your parents think that your consolidated family income is higher than the qualifying mark, there’s really no harm in filling out the form. After all, it is the ‘Free’ Application of Federal Student Aid! And unfortunately, almost $24 billion of different student aids are unclaimed every year! Such a waste, right?
Before exploring student loans, first, explore FAFSA. Different universities have different deadlines, so it’s best to apply early.
The cost of higher education in the US is astonishingly high and often leaves people struggling to pay off their debts well after they graduate from college. Such a piling amount of debt so early in life is not a great confidence booster. But careful planning and the above tips for debt management can prevent you from being in a financial soup in the first place.