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Is is a smart decision to take out loans?

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Kim’s Answer

Alondra,

Education is considered to be an investment in your professional self. If you need a degree to achieve your goals, and have exhausted all other possible funding sources, and alternatives to getting a degree, then, all that leaves is loans.


Other funding sources include scholarships, grants, work study, a job, family, etc. It is possible to get tuition assistance through various employers - they have tuition assistance programs where they reimburse you for a part of your tuition, depending on what grade you get. The terms vary ---it might have to be a job-related degree, you might have to promise to continue working for them for x number of years, etc. Joining the military is another means of getting your education paid for.


Other things to consider is what school you are going to. Attending a junior college, and living at home, for the first two years will help reduce expenses.


Student loans have to be paid back. Except: ????? there are loan forgiveness programs if you get a government job, go into teaching, etc. You should research these opportunities.


Obviously, you want to minimize indebtedness resulting from education. But ultimately, yes, it can be a smart decision to take out loans.


Kim
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Tristan’s Answer

It can be. There's a few things to weigh when you're looking at taking out loans, but it all comes down to if the investment in your education will pay off with higher earnings in the long run. If your school is very expensive, and you're looking to move into a field with low average wages, it might not be the right call. If you think you'll be able to earn enough money to pay off your loans quickly, it's a good move. I strongly recommend checking out Dave Ramsey's work, he covers finance questions like this in a lot of detail. It's an excellent question to be thinking about, and one that many people wished they'd considered earlier.

-Look for scholarships and tools to get through school for cheap.
-Learn about your field's earning potential, if you have one in mind, and be realistic.
-Study the difference between "good debt" and "bad debt", and decide which one your college would be.

Good luck!
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