4 Great Uses for a Private Student Loan | 04.08.10
When it comes to private student loans, many potential borrowers believe they only can be used on tuition. Thankfully, this assumption is false. In reality, a private student loan is a very flexible lending option that allows you to take out as much money as you need (based on creditworthiness) to cover expenses that federal products or scholarships may leave behind. Let’s take a look at some uses for a private student loan:
Textbooks are extremely expensive, to put it mildly. On an average semester, I paid anywhere between $300-450 on textbooks for a five class load. I graduated this past year, so those numbers are current… in case you were wondering. This number can sometimes be reduced if you purchase used books online or rent them, but not all titles are available consistently.
2) Apartment Rent
If you live off-campus, finding the money to pay the rent, utilities, food costs etc. can be a struggle while you are in school. During my time at college, my average rent was in the $550/month region (in Boston, MA), utilities averaged about $60/month, and I spent $60-80/week on food/groceries. That rent figure is based off living with multiple roommates; if I lived by myself, it would be more like $1100-1300/month.
Obviously, these numbers are a little overwhelming if you are trying to work during the school year and pay down at least some of your school costs. A private student loan can be useful in this situation by taking care of a large part of the costs, or all of them, depending on how much money you elect to borrow. I generally took out a $5,000 private student loan per year to cut down what I had to pay out of pocket on my rent to a much more manageable number.
3) Study Abroad
If you haven’t had a chance to read my blog on study abroad financing, I definitely would recommend it. It gives a couple little tips that make planning for the trip much easier and takes the stress off.
4) Clothing / Shopping Necessities
This may sound like a throw-away point, but it really isn’t. If you go to school in a climate that is dissimilar from what you are used to, buying clothes is inevitable. A few of my friends in various classes came to Boston to study from a variety of places such as California, the Dominican Republic, and Mexico. A month after arriving and settling in, they all had to work overtime at their jobs to save up money or beg their parents to send them some funds to buy Fall / Winter clothes due to Boston’s rather frigid climate.
There are other necessities you may not think of too. If you wear contact lenses, those are not cheap to buy when you need extra boxes. If you get sick, prescription medication and/or doctors fees may be more than you can afford to pay out of pocket. These are the types of unexpected expenses that pop up when you are in school, and having the extra cash available to you is extremely valuable and a frustration saver.
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