Filling out college applications and earning a degree can be a real investment in your future – but it's never been more expensive, either. Millions of students rely on financial aid packages such as student loans to help them pay for school, but who's borrowing them? New data from the Federal Reserve Bank of New York reveals who is borrowing, how much they are taking on, and how many people are making their payments.
According to the data, almost 40 percent of the 37 million student loan borrowers in the U.S. are under 30 years of age. This works out at just over 33 percent of the $870 billion total outstanding loan balance. Approximately 43 percent of students borrowed up to $10,000, with an additional 29 percent taking out loans of between $10,000 and $25,000.
Despite an uncertain economy, many students are keeping on top of their repayments. The data suggests that almost 40 percent of borrowers had no past-due payments, and their balances were smaller in the third quarter of 2011 than the second. For students thinking of filling out college applications and taking out a student loan, this could be encouraging.
College-bound students can use the savings calculator at studentloans.gov to get a better idea of how much they need to put away to make their repayments. If you're considering going to school, talk to your college admissions adviser about the various types of financial aid that are available before you commit to any decisions. According to the website, the government provides more than $150 billion per year in scholarships, student loans, grants and other financial aid packages to students who want to earn their degrees
Another option that can help you pay for academic costs are work-study programs. These initiatives provide undergraduate students with part-time jobs that help them pay for educational expenses. Students are paid by the hour, and many schools offer individuals jobs on-campus to make it easier to balance their studies with part-time work. Some colleges might have arrangements with private companies, too. If this is something you're interested in, talk to your school's financial aid officer.
Financial aid, student loans and paying for college can be daunting. However, with some careful planning and help from your college admissions adviser, it doesn't have to be. When you're doing a college search, think carefully about how the cost of earning your degree will affect you further down the road.