Borrowing Wisely

Valdosta State’s Office of Financial Aid is committed to building student awareness of financial responsibility and providing resources to educate you about responsible money management and borrowing. Attending college is an expensive investment in your future. Protect your investment by spending, borrowing, and saving responsibly!

What should I use my loans for?

If you’ve taken out student loans, remember that the loan money is for your education. It may be tempting to borrow more than you need for educational expenses, but accepting a student loan means you are agreeing to spend the money on education expenses like tuition, fees, books, transportation, and necessary living expenses.

How much should I borrow?

Never borrow more than you need!  A general rule of borrowing is that your total loan debt when you leave school should be less than what you might earn as your starting annual salary after you graduate.  Ideally, your monthly loan payment should be no more than 10% of your monthly paycheck.

Do I have to pay all of it back?

When you borrow student loans, you’ve made a legal commitment to pay back all of the money, with interest. Subsidized loans do not accrue interest while you are enrolled in at least 6 credit hours. Unsubsidized loans accrue interest as soon as the loan is distributed to you. A responsible student borrower will plan to pay the interest on any unsubsidized loans while still in college. Even a few dollars a month in interest payments will keep the unsubsidized loans from growing.

Students who borrow through private lenders should contact their lenders directly for up-to-date information. Remember that, unlike federal student loans, the interest rates on private loans may be variable.

When should I start worrying about my balance?

Always know what you owe and track your student loan debt. There are limits to how much you’re allowed to borrow each year and in your total student career. You’re responsible for knowing these total loan limits.

What does repayment look like?

Students who know how much they owe can plan their lifestyle after graduation to allow for the quickest possible loan repayment. You can estimate your monthly loan payment by using the U.S. Department of Education's interactive calculator on the Federal Student Aid web site and choosing from different repayment plan options. There are also some Federal Student Loan forgiveness programs for teachers, government employees, and others.

What if I can’t pay my loans back?

If you ever experience any difficulty in making a loan payment, contact your loan servicer immediately to prevent loan default. The loan servicer will work with you and explore all options to avoid default. Keep in mind that student loan indebtedness cannot be forgiven by bankruptcy.  The Federal Government can require your employer to garnish your wages and the IRS can keep your tax refunds to pay down your debt.