Being in college is difficult enough without the added stress of trying to navigate the complicated world of student loans and financial aid. Some of us have probably already been there—entering the financial aid office on campus to get some help from an advisor and finding a line 50 people deep. At my school, it used to be an ongoing joke that you would need to pack a lunch if you were planning on hitting up the financial aid office for anything. But, of course, there’s a reason why that line is always so long—pretty much everyone will run into some issues or questions with financial aid at some point during college.

There is a wide array of options available to you as a college student to secure funding for your studies, and taking out a student loan is just one. Better options, though more scarce and hard to obtain, are scholarships and grants, since they don’t require repayment. Student loans are just that—loans, which you will be expected to pay back after you graduate, with added interest. But with the rising cost of tuition and the difficulty most students face when applying for scholarships and grants, student loans are a fall back funding option for about 70% of college students.

money

When I started college as an undergrad, I knew very little about loans and the borrowing process. My parents handled most of my finances that first year, and I was pretty much in the dark about the whole topic. Down the road, I began to educate myself on financing and the loans I had been accepting and taking out, and I began to borrow a bit smarter. It might all seem like a complicated, endless process of contracts, promissory notes, and interest rates, but if you know the basics going in, you might find it a bit easier to navigate.

Calculate your total cost of attendance.

This is an important step to take each year you are enrolled in school. Tuition and cost of living will rise every year, so recalculating and understanding your actual financial need is crucial. This will help you determine how much you actually need to borrow, and prevent you from overborrowing. There are online calculators that can help you determine this amount, or you can do it with old-fashioned pen and paper. You’ll need to consider things like tuition, fees, housing, transportation, books and supplies, and whatever other miscellaneous costs you might personally need to factor in.

Decide what kind of loan you want.
Federal loans are loans provided through the government, and are often the best choice, for a myriad of reasons. Federal loans have fixed interest rates that won’t rise or change over time, whereas private loans can often have interest rates that rise or fluctuate with the market. You won’t have to repay federal loans while you are in school, while some private loans require immediate repayment after dispersal. Some federal loans are subsidized, meaning the government will actually cover the interest of the loans while you are still enrolled in school, while private loans don’t offer this. Do your research, and decide which type of loan will suit your needs.

piggy bank

Fill out the Free Application for Federal Student Aid (FAFSA).
FAFSA is required by most universities and colleges, as it essentially assesses your financial need and helps calculate what kind of contributions you will have to make to pay for school, as well as connects you with different available types of aid you might be eligible for. Make sure you fill this out each and every year. Try to turn it in prior to the priority deadline, which is usually sometime in March. Most financial aid offices at colleges and universities will have programs or specialists available to help you through the process should you need assistance. If your parents claim you as a dependent on their taxes, you will need their tax information when filing your FAFSA.

Know your repayment options.
Whether you decide on a federal loan or a private loan, make sure you are entirely clear on how you must eventually repay that loan. Federal loans offer a laundry list of options for repayment, including an option that is contingent upon your income, which can help you avoid getting behind on payments or going into default. Make sure you know what the consequences for missed payments are, and what options you have should you fall into difficult financial times in the future and need help with payments. Understand the interest rate on your loan, and whether or not it is a fixed rate. Know what company or bank you will be making your payments to when the time comes, and how those payments can be made.

student cafe

Avoid overborrowing.
Just because a loan is offered to you, that doesn’t mean you have to take it, or take the full amount. Using your calculated cost of attendance and financial need, borrow only what you need, and resist the temptation to borrow anymore than that. There are federal programs such as Federal Work Study which allow you to get a job working on campus to help pay for college expenses, and you can also try getting a part time job near campus to help pad your bank account should you need it. If you parents or guardians are in the position to help you financially through college, ask if they can provide you with loans instead. They might be easier to pay back than the federal government.

In 2016, student debt has risen to an average of about $37,000 per graduating student. This number is even higher for those who are graduating with professional or post-bac degrees. With a little bit of research, education, and careful planning, you can borrow responsibly and make sure you are comfortable with your financial choices through college. The important thing to remember when borrowing is that you must think of tomorrow rather than only today—the financial choices you make today will affect you down the road, so make sure you are making choices you can live with in the future.