Student Loan: Don’t Be Broke for the Rest of Your Life

debtA free education for everyone is still a dream. Thousands of students all over the world continue to pay to get a higher education no matter how talented and dedicated they are. Someone uses parent’s costs, and someone needs to earn money to be able to pay for studying. Mindful students continue to visit college or university even if they are short of money: they understand the importance of education in the modern world and do not want to lose precious time. That is why they decide to take a student loan.

First, a student does not even understand what exactly is going on. He receives money and gets a chance to continue his education. But when he decides to dig deeper, he finds out that despite the multiple benefits, loans have some dangers.

What is student loan?

Originally, a student loan was a helper for those who are in need and cannot pay for themselves. These costs helped with buying suppliers, finding a tutor and paying a fee for the education. Today, a student loan is more a bank credit.

Unlike scholarship and grant for education, a loan does not mean that you will study for free. In fact, you study in credit of a state, and in several years you need to pay money back. Different countries have different approaches to introducing this opportunity. In the U.S. two types exist: federal and private. Taking a federal loan, you are obliged to pay it back. The laws for repayment change all the time as the government tries to find a balance between offering loans and keeping money in a budget.

Private loans are sponsored by universities and non-government organization. As a rule, they are bigger than federal loans and are offered to talented students who cannot pay for themselves.

Risks of loans

Although a student loan opportunity may seem to be rather attractive, it has various dangers. While you are studying, they do not seem so obvious. But you meet them just right after you graduate the university or college.


  1. Students loans are not dischargeable in bankruptcy.
  2. Most of the loans are anti-insurance.
  3. The repayments are rather high no matter the size of your salary.
  4. Student loans frequently ruin the financial stability for retirement.
  5. The debt cannot be shifted to another person.


The risks of the student loan have caused many talks in government. Different commissions tried to introduce some new ways to make these loans more effective for students reducing the existing risk and adding new options for repaying the debt. However, this is still an urgent issue today. Educational organizations continue to fight for equalizing the opportunity for getting a higher for everyone representing new solutions to existing problems. Still, it is a long way and we are still at the beginning of the road of getting off the risks from taking a loan.


What to do if you cannot repay a loan

In spite of all dangers, students keep taking these loans to be able to continue their education. However, sometimes something goes wrong and a person can no longer repay a debt. It is extremely important to keep calm in this situation and follow the guideline that we created for the students who met this problem.


  1. Inform your lender

The first thing you need to do is to contact your lender and inform him that you cannot longer repay the money. In some cases, the payments are postponed for some time so you can find a better job or explore a new way of repaying the debts.


  1. Check your paying plan

Frequently, students cannot repay the loan only because the paying plan is too complicated to accomplish. For example, you need to pay $200 monthly during 10 years. You can change it to $100 during 20 years or even less for a longer period of time.


  1. Check the options to postpone payment

Sometimes, your investor (a private or federal organization) do not offer the possibility to postpone payments. However, it does not mean that you cannot claim for it. Your claim will be taken into consideration no matter what. If you cannot find full-time employment, you are military obliged or you suffer from the economic hardship, claim for the postponing of payments.


  1. Explore whether the cancellation is possible

Cancellation of a debt is not a rare case. There are some qualifiers that allow you to claim for the forgiveness of your debt and get rid of this loan burden. The cancellation may be claimed National Health Service Corps and The American Occupational Therapy Association.

If you have decided to take a student loan, you’d better consider twice. Perhaps, you should take a year off and earn some money to continue studying or ask you friends and family for support. Remember that in most cases the loan is repaid up to 25 years, and you should cut off your budget each month. Of course, education is highly important for your further development, but in some cases studying just does not worth it. We do not encourage you to quit the dream about higher education. In fact, we kindly ask you to consider another university with lower prices, applying for a scholarship and even trying yourself in applying for studying abroad. The possibilities are multiple, and you can choose the right one for you!

kevinAuthor’s Bio:

Kevin Nelson started his career as a research analyst and has changed the sphere of activity to writing services and content marketing. Except writing, he spends a lot of time reading psychology and management literature searching for the keystones of motivation ideas. Feel free to connect with him on Facebook, Twitter, Google+, Linkedin.


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