How to Be Proactive About Student Debt Even BEFORE Graduation

student debtIt’s that time of year again. Summer is winding down. Vacations are coming to an end. And millions of American college students are venturing forth toward new experiences, advanced learning, and… increasing student debt.

Wait… What?

Seven out of ten American college students will borrow money to attend school this year. At present, America’s total student debt stands at nearly $1.4 trillion, with $833 billion of that in Federal and private student loans.’s National Student Debt Clock estimates that the total student debt is increasing by $2,853.88 per second.

I recently spent an afternoon talking with my son, who is returning for his second year at the University of Pittsburgh, about the student debt issue. He is, understandably, worried. Like so many others, he will have to borrow money for school. As an engineering major, he’s confident his future income potential will justify the expense. But being proactive by nature, he doesn’t want to wait until after graduation to begin dealing with it. The truth is, he doesn’t have to.

And neither do you.

Here are five tips to proactively manage student debt while you’re still in school.

1. Search Diligently for Scholarships

Most people think of college scholarships as full or partial tuition granted by a college or university to students who exhibit academic or athletic excellence. While that kind of scholarship is certainly worth pursuing, there are billions of dollars in private scholarships available to new and returning college students every year. These are often smaller scholarships sponsored by business entities, community organizations, memorial funds, and even individual philanthropists.

Eligibility requirements range from economic need to field of study. Most of these scholarship do require a certain level of academic achievement. Many also have a strings attached, from community service to commitment to a specific industry. So it’s not actually free money. You still have to work for it. But whether it’s a $500 scholarship offered in memory of a lost loved one, or a $5,000 scholarship from your church that requires 50 hours of community service each summer, every little bit you get now is less you have to pay back later… with interest.

1. Maximize Your Courseload

Many colleges and universities offer a flat tuition rate for students designated as “full time.” This often applies to any student taking between 12 and 18 credits per semester.

The average credit requirement for graduation at most colleges and universities is 120. If you only take 12 credits per semester you will graduate in 5 years or 10 semesters. At 15 credits per semester that drops to 4 years or 8 semesters. If you can manage 18 credits per semester, you can get your degree in just over 3.5 years and still pay the same tuition per semester.

Never take more classes than you can handle. You want to be successful, after all. But do the math.

The longer you go, the more you owe.

3. Get a Summer Job or Paid Internship

Working or interning during the summer may seem obvious, but many students look at summer as an extended vacation. They use the time to hang out with friends. They relax on the sofa or beach.

But next summer, that won’t be you. Get a summer job or paid internship. Preferably in your field of study, of course. But any job will help not only build your bank account and minimize the need to borrow, it will enable you to further your soft skills and gain valuable experience.

4. Avoid Credit Card Debt

Of the $1.4 trillion owed by American college students, nearly $8 billion is in the form of revolving credit. 98 percent of revolving credit is credit card debt. Banks can be predatory in their efforts to sign students to credit card agreements. They often offer sub-prime interest rates because the student has no established credit score. During that first week on campus, it’s not uncommon to see reputable lenders giving away everything from beach towels to MP3 players. And all you have to do is fill out an application.

Taking advantage of a few of these offers can be good. Responsible credit card use while in school helps establish credit and improve your credit score. But maxing out every card you can get and paying the minimum each month will only increase your burden both while you’re in school and after you graduate.

5. Don’t Borrow More Than You Need

It’s important to remember that a financial aid award letter or a loan offer from a bank is just an offer. You don’t HAVE to borrow the full amount. Carefully calculate your expenses. Then develop a budget that takes into account any scholarships and monies earned from that summer job or internship. Then look at any money-saving measures you can take. If the amount you actually need is less than the amount offered, only borrow what you need.

Student debt is a growing concern in America. Many young people feel like they are forced to start their lives under an oppressive burden. It’s important to know you don’t have to wait until you graduate to begin taking steps to ease that burden.

Be proactive. Start managing your student debt now… even before graduation.

This post previously appeared on

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