# About to take out my first loan for college

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1. Jun 8, 2007

### Winzer

Ok so I about to take out my first loan for college- a big one.
But I figure that I am in engineering I will be making quite a bit of money and won't have to worry about it.

2. Jun 8, 2007

### Cyrus

how much is the loan?

3. Jun 8, 2007

### Winzer

maybe 15000-18000

4. Jun 9, 2007

### Cyrus

Thats not a lot of money. Is that for one year, or all 4 years?

5. Jun 9, 2007

### Winzer

In your opinion cyrusabdollahi what would be a lot of money to take each year?

6. Jun 9, 2007

### Cyrus

If you are living on campus at an in-state university, 15-18 is about right.

I pay $9k a year because I live at home and go to in-state school. 7. Jun 9, 2007 ### Beeza I take roughly 12k per year, but thats only for tuition as I pay living expenses out of my pocket. 8. Jun 9, 2007 ### JasonRox I thought you said your parents pay for school. 9. Jun 9, 2007 ### JasonRox Yeah, that's what I recommend people to do unless living expenses are sky high. I'd atleast try to pay half of it. My tuition is$5000 a year, but I'm going to be debt free when I graduate. I'll probably have money in the bank or atleast that's what I'm planning.

10. Jun 9, 2007

your first year, take out whatever loan you need, you have no choice at this point. work your butt off the first year and then apply to as many scholarships as possible. my first year i took out the max stafford loan (I go to state school and am low income, so i got 85% of my tuition paid off already). then i applied and got 3 scholarships and an undergrad fellowship that i am applying for right now and will most likely get over my soph and junior and into senior year. i haven't paid for anything except books, in fact my school has been paying me roughly $1500 a semester to attend because i got so much financial aid and scholarships. bottom line is, first year, the cost and loan is usually unavoidable. but you need to be saavy and understand every oppurtunity that is available to you. PS: Especially in engineering, there are a lot of scholarships, specifically school wide. good luck and don't stress out too much about loans. the average student graduates with like$30 in debt. i will be graduatingwith like $5000 in debt. 11. Jun 9, 2007 ### Cyrus I would listen to InbredDummy. Also, if your tution includes living on campus, you can consider living at home to save yourself 5-6k a year in living expenses. Taking your high value, in the end you will have roughly$72k in debt. If you get good grades and get scholarships, you can knock this value down a lot. A LOT. Even if you pay the full $72k, provided your grades are good and you dont mind living at home one year after you graduate, you can easily knock off about$50k in one year if you spend all your money paying off your loan. You will have to live at home for a year, but you will be almost debt free afterwards.

12. Jun 9, 2007

### JasonRox

Easily? Not by a long shot. Atleast be real about it.

13. Jun 9, 2007

### Winzer

Well technicaly this will be my second year in college. I went to a state college my first year to save a bunch of money-my plan originally. I then transfered. I will be livin in the dorms this fall so I will be paying that expense. I was thinking I will give it my all this year so I can get good scholarships for the next.

14. Jun 10, 2007

Yes, it is easy. If you cant pay off $50k in one year living at home you dont know how to manage your money. Exactly what expenses will you have living at home? Are you going to spend your entire paycheck on food? Gas and food are the only two things you will need to spend your money on. If those two alone eat your paycheck up, somethings wrong. Last edited: Jun 10, 2007 15. Jun 10, 2007 ### dontdisturbmycircles I think that taking out a big loan and investing it in your education is the smartest thing you can do. My philosophy is that working hard during the summer is a waste of time. Work one job and study or take a summer course. I am guessing that a$60,000 loan really isn`t that big of a deal once you graduate. (As long as you graduate...)

16. Jun 10, 2007

### Beeza

It's not always that clean cut and easy for everyone. Lots of other factors come into play.

17. Jun 10, 2007

### JasonRox

First of all, you're assuming this person does not go out at all. Like you said, only gas and food. You're also assuming mommy and daddy pays insurance and rent, which most parents will make you pay rent after graduating.

Second, what about the damn taxes? Should be mostly tax free up to an income of like $30-40k, which they tax the income you make after that. By your numbers, you're assuming this person makes atleast$75k right after graduating. How often does that happen? Again, not often at all.

Third, you're forgetting the interest! Most places charge you interest as soon as you graduate or basically all places. Not only that, most places charge you interest even before you graduate. At a debt of $70k you assumed easily to pay off, you're interest will be atleast$450-600 a month!!! Try paying off debt with that kind of interest rolling around every month. Well, if mommy and daddy pays that too, then yeah it shouldn't be too bad.

18. Jun 10, 2007

### JasonRox

Yes, that is a big loan. Trust me. Lots of people ignore it after graduation too. They simply just pay the payments with maybe a bit more on top of that and that's it without realizing that with those payments it will take like 15 years to pay it off. Then they're like, even after paying my loan payments, I have enough money to buy that fancy car I deserve because I worked so hard (yet you literally worked very little which is why you have that big debt) to get my degree. Then you buy the car, then rent a place, then buy furniture... and next thing you know the interest rates go up say a mere 0.25% then you're like... hmmm... I just have to be a bit frugal now and 6 months later you're on the brink to bankruptcy.

That's the plan?

19. Jun 10, 2007

### JasonRox

He's not going to have debt. His parents pay for school and such. I don't understand why he is telling us how to manage debt when he ain't going to have any.

20. Jun 10, 2007

### dontdisturbmycircles

The difference is income earned during the summer is at a rate of $15/hr whereas income earned after graduation may be$30/hr so its much easier to pay off. I agree that \$60,000 is pushing it(my loan will be about 1/3 of that.) but if you work hard in school you should get some of that back in the form of scholarships/bursaries right?

It all depends on how you are going to live after you graduate. If you are serious about paying off your debt it really shouldn't take you more than 2-3 years to do as long as you don't but a new car / house.. But thats obvious :)