With an average student medical loan debt reaching $47,000 this year, American students go into significant debts in order to cover their college tuition. Unfortunately, not everyone is born into a wealthy family or have sufficient savings to cover their university expenditures.
Let’s elaborate on what pros and cons a student loan has.
Advantages
You Can Afford Yourself Getting a Degree
A university degree has become a must if your aim is to enter a huge corporation and take a decent position there. A student loan is basically a direct ticket to the wealthy and prosperous future of your dreams.
You Can Opt for a Better University
Universities differ. So do their costs. Therefore, if you want to enter a prestigious college, you should pay more. The increased price of tuition and accommodation may be unaffordable without financial aid. Although it’s great to get a scholarship, it’s very difficult. That’s why many turn to student loans, and use a tool like this calculator on SoFi (https://www.sofi.com/student-loans-payoff-calculator/) to help them work out how long it will take them to pay it off, which may help them decide how much they want to borrow in the first place.
You Can Cover Additional Expenditures
A student loan isn’t used solely for the board, room, or tuition. You can cover additional expenditures, which are numerous, by the way. This definitely makes your college life much, much easier.
You Are Building Your Credit History
It’s hard to get a mortgage or an auto loan if you don’t have a credit history. Taking a student loan is a good solution as you are building your credibility in the eyes of lenders. However, there is another side to it: if you fail to cover the installments, you are destroying your credit score instead of developing it.
Disadvantages
You May Have Less Pocket Money
The necessity to repay a student loan means that you will have less free money. In other words, you will have to sacrifice a lot in order to cover installments. That’s why sometimes, students opt for Payday Depot that help them to cover the basic needs in case of emergency.
You Usually Have to Work to Repay the Debt
When all your peers are enjoying their life and are only bothered with studies and exams, you have to work to cover the bills. It’s rather difficult. At the same time, it develops discipline and a sense of responsibility.
You May Have to Put Off Other Life Goals
Repaying a student loan is hard. Many keep being stuck with installments even after they receive a degree. It means that a dream of a car or a flat is a bit further away for you.
Mostly, You Can’t Get Rid of the Loan If You Fail to Repay It
Failure to repay debts is a serious problem. Sometimes, to get rid of the borrowing, a person files for bankruptcy. Unfortunately, the chances it will help you to avoid paying off a student loan is very low.
Now that you know all the pros and cons, it’s up to you whether to take a student loan or not. If you decide to do this, make sure you can repay it in time.
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