All other things being equal, it’s better to graduate less debt than more. Here are two big reasons why:
- Loan debt isn’t like other kinds of debt—you’re basically stuck with it until you repay it.
- Sizable debt—and the big monthly payments go along with it—can really drag you down after graduation. They can force you to take a job that you don’t want, force you to live with your parents, or eat up your discretionary income—all situations you’d hope to avoid as a college-educated worker.
As I’ve mentioned before, many smart students limit their borrowing to subsidized federal Direct Loans. Not only do these loans have low interest rates, they’re capped at reasonable levels: your maximum Direct Loan debt would be $27,000 if you complete your degree in four years. This might not seem like much to cover the cost of a college education, but remember: student loans aren’t the full picture. Ideally, they’ll only come into play after parent contributions and scholarships and grants.
To figure out the maximum amount that you would like to borrow for college, click here.