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With the cost of attending college ever increasing, it may seem that taking out a lot of student loans is an easy way to pay for it all. The loans will have to be repaid, with interest, once you graduate, meaning they are not the best way to pay for school. If you do need to borrow money for college, learn about the different types of loans first and strive to get the best deal on any student loan you choose.

Private Vs. Federal Loans

When you complete the Free Application for Federal Student Aid, the school you plan to attend determines your eligibility for a federal student loan. You can only borrow up to a certain amount each year with a federal loan, so some students choose to also take out private loans.

Private loans do not have the same protections as a federal loan, though. Federal loans allow you to take a deferment or forbearance on the loan in the event of a financial hardship, such as a job loss. If you have a subsidized student loan, the government will pay your interest while you are in school. You can also take out an unsubsidized federal loan. You will be responsible for the interest on that loan while in school. Additionally, the interest rates on a private loan are usually variable, meaning they can increase from year to year. Federal loan interest rates are fixed at either 6.8 percent for unsubsidized loans or 3.4 percent for subsidized loans. The higher the interest rate on a loan, the more money you will have to pay in the end.

Tricks to Keep Your Student Loan Debt Low

Look at the overall cost of attending the school of your choice. Don’t forget to include the cost of things such as books, meals and the occasional night out. Add up all the student aid you’ve received that you don’t have to pay back, such as scholarships and grants. If you plan on working during school, estimate how much you’ll earn each semester or year.

If the amount of aid, work income and savings you have doesn’t cover the cost of school, add in the maximum federal loan amount. If it still doesn’t cover the cost of your school, it may be in your best interest to choose a less expensive school to attend. Ask yourself if getting a bachelors from an expensive school is worth repaying thousands of dollars in student loans for at least the next ten years.

When you take out a student loan, whether federal or private, do your best to keep up on interest payments, even while you are still in school. Any interest you don’t pay while in school, on unsubsidized or private loans, is added to the principal, or total amount of the student loan, once you graduate. That means that you will end up paying more over time, as instead of a $5,000 loan, for example, your loan is now $5,500.

Once you are out of school, pay a little more than the payment due each month. You’ll pay your student loan debt off faster and pay less in the end. Another option, if you have a lot of loans, is to consolidate them. In some cases, consolidating will lower your interest rate. You can also try doing a year of service with an organization such as AmeriCorps or Teach for America. At the end of your service, you will receive an education award that you can use to pay off your debt.