How to Manage Student Debt

Welcome to our last post for the month of October! Unfortunately, your students will continue being haunted by student loans long after deciding what loans are most convenient for them.

Developing a plan to manage their student loans is crucial to long-term financial and overall health. Here are a few tips to help your students manage their loans.

To learn how to budget click here.

For more information on consolidating your loans click here.

Join us at World Future Forum for more research findings and best practices on student debt!

Student Loan Forgiveness

If there is no way for your student to get around student loans, there are a few options for students to stop paying back their loans. However, theses methods are not always easy to obtain and are not available for all students.

Student loan forgiveness is when a student is no longer required to pay for their student loans. There are three overarching circumstances that might lead to forgiven loans.

  • Career: If your student pursues an education in a public service sector, they can be eligible for loan forgiveness after completing a certain amount of on-time payments and working in that field for a certain amount of years. This option does not apply to private loans. Some student loan forgiveness programs that depend on careers include but are not limited to:
  • On-time payments: If your student pays their loan on time, they can be eligible for student loan forgiveness after 20 years. This sounds like a long time but it usually the remaining balance is forgiven after 20 to 25 years. In this option, career field does not play a role and it does not apply to private loans. Some programs depending on on-time payments are:
  • Student loan discharge (extraordinary circumstances): This option is usually awarded by a judge so there is not guarantee of acceptance. Student loan discharge applies to both federal and private loans. Extreme circumstances for this discharge include but are not limited to:
    • permanent disability
    • death
    • identity theft
    • unauthorized signature of the loan without the student’s knowledge
    • bankruptcy

For more ways a student can obtain student loan forgiveness, click here.

Join us at World Future Forum for more research findings and best practices on student debt!

Types of Loans

After heavily researching and applying to scholarships and grants to pay for college, students might need to look for student loans. As discussed in our previous blog, Components of Loans, there are three basic components students should look out for when considering loans. Student loans come in various shapes and sizes and there is no universal “better” option. It is all very dependent on the individual student. This can, definitely, be overwhelming for your students; however, here is a quick cheat sheet we have created for you!

Join us at World Future Forum for more research findings and best practices on student debt!

Components of Loans

Early this month, we briefly mentioned loans, but what is a loan and what must a student look out for when considering one to pay for their higher education? To that I say, “Do not fear; we will show you the ins and outs of loans here!”

A loan is when a party borrows money from another with the agreement that the amount (plus a percentage) will be repaid to the lender. There are three basic components of loans: interest rate, term of the loan and security.

The interest rate is basically the extra amount the lender is charging the student to borrow their money. This is usually a percentage of the total amount loaned and can range greatly. The lower the interest rate, the better. It is very important that the student understands the exact amount of money that the interest is adding on to the loan, because it adds up quickly. There are two types of interest rates: fixed and variable. Fixed rates will not change throughout the life of the loan; on the other hand, variable rates will change depending on market conditions.

The term of a loan dictates the maximum amount of time the student has to pay the loan plus interest back in full. The term of a loan can be anywhere from 1 to 30 years. It is important to note that loans can be completely paid off before the term with no repercussions. The term of the loan will affect the student’s monthly payment, so it is something that will depend on the individual student.

Loan security is either secured or unsecured. A secured loan requires a collateral. This means that if the student does not pay the loan, the lender can keep that collateral. This guarantees that the lender will somehow get their money back. Contrarily, an unsecured loan requires no collateral so the lender cannot make their money back if the student does not pay back. However, unsecured loans usually have a higher interest rate because of the risk taken by the lender.

There is no universal correct way to decide on a loan. It depends solely on the individual student and their financial situation.

Look out for our next blog post to learn about the different types of student loans available.

Join us at World Future Forum for more research findings and best practices on student debt!


Another great way to help your students avoid student debt is by encouraging them to apply for scholarships. Unlike loans and other student aid, scholarships do not have to be paid back, which make them the best alternative to student debt. There are thousands of scholarships available for students every year. It is only a matter of students making time to find them and to apply.

Good news! There are multiple reasons your students can be awarded scholarships and not all of them merit-based. Everyone has an opportunity at receiving scholarships. Some types of scholarships available are:

  • Academic scholarships or merit scholarships are awarded to students with a high GPA or SAT/ACT test scores.
  • Average academic performance scholarships are awarded to students with average GPAs but also focus on well-rounded students and scholarship essays.
  • Athletic scholarships are awarded to students who excel in sports. These are usually awarded by universities in order to persuade the athlete to play on their teams.
  • Minority scholarships are awarded to students belonging to “minority” ethnic groups. There are scholarships for individual ethnic groups as well as scholarships for students of any minority.
  • Women scholarships are awarded to women to encourage a more diverse campus. Another tip is to look for major-specific scholarships for women, especially STEM subjects.
  • Creative scholarships are awarded to those who want to pursue a creative career in music, art, dance, etc. These scholarships are usually more common in art schools and sometimes require a sort of audition.
  • Unusual scholarships are awarded for many fun reasons. There are scholarships for unique talents or random competitions. For example, creating a prom dress entirely out of duck tape. There are plenty of unusual scholarships awarded by private companies; they might just be a little harder to find.
  • Community service scholarships are awarded to those who have completed community service activities. If your students are interested in scholarship, it is very helpful for them to put together a community service hour log to track their involvement.

There are several free websites that match your students’ profile to scholarships that might be available for them. Here are a few of these resources:

Join us at World Future Forum for more research findings and best practices on student debt!

Financial Aid Alternatives

What if your students don’t meet all the requirements for federal financial aid?

If a student is not eligible for federal aid, they might be eligible for financial aid from their state. Almost all state education agencies provide at least one form of financial aid or have student aid programs available to residents of that state.

It is important to check both the student’s state of residence and their university’s state financial aid options. Heads up, many states require students to fill out the FAFSA, regardless of FAFSA eligibility, to determine the amount of money to award or other possible financial aid opportunities. Other states have their own applications, which can easily be found here.

Can undocumented students receive financial aid?

If your student is undocumented, many states offer financial aid for U.S non-citizens, especially Deferred Action for Childhood Arrivals (DACA) recipients. If your undocumented student needs to complete the FAFSA application, here is more information on filling out the application.

How can a student with a drug conviction receive financial aid? 

If your student has a conviction for the possession or sale of illegal drugs for an offense that occurred while receiving federal student aid, they must complete the FAFSA and the Student Aid Eligibility Worksheet. This form helps the federal government determine if they are eligible for full or partial aid.

Join us at World Future Forum for more research findings and best practices on student debt!


Financial aid is money awarded to students pursing a higher-level education such as attending a technical school, community college or a four-year university. This money can be used to pay for tuition and fees, housing, transportation, school supplies and books.

The Free Application for Federal Student Aid, or FAFSA, is required to receive federal financial aid. It determines how much financial help you qualify for from the federal government. Many universities require students to submit a FAFSA to determine how much financial aid they will provide as well. Therefore, FAFSA is a crucial part of the college admission process.

Does your student qualify for federal financial aid? Your student must: 

  1. be a citizen or eligible non-citizen of the United States of America
  2. have a Social Security Number
  3. have a high school diploma or equivalent
  4. be enrolled in a higher education institution as a regular student
  5. maintain satisfactory academic progress.
  6. not owe a refund on a federal student grant or be in default on a federal student loan.
  7. if male, be registered with the Selective Service System
  8. not have a conviction for the possession or sale of illegal drugs for an offense that occurred while you were receiving federal student aid

What does your student need to complete their FAFSA? 

  1. Federal Student Aid (FSA) account
  2. Social Security Number or Alien Registration Number (for non-U.S. citizens)
  3. Federal income tax return (W2 or retrieve from IRS Data Retrieval Tool)
  4. Bank account statements (if applicable)
  5. Records of investments (if applicable)
  6. Records of untaxed income (if applicable)

Note: If your students are dependent, they will also need the above information for their parents or legal guardian.

The FAFSA application for the upcoming academic school year opens every October 1st. The deadline for FAFSA is officially June 30th; however, it can be earlier for your students if their institution uses it to offer college aid. The deadlines set for each college can usually be found on their website.

It is important to note that the FAFSA is awarded on a first-come, first serve basis. If you have students who will be attending a higher education institution during the 2019-2020 school year, encourage them to complete the application at,  print out the PDF version here or even download the app version!

Join us at World Future Forum for more research findings and best practices on student debt!


Avoiding Student Debt

As of 2018 stats, “Americans owe over $1.48 trillion in student loan debt, spread out among about 44 million borrowers.”

The looming, dark cloud over higher education in the U.S. is, of course, student debt which is why we are focusing on this World Future Forum topic during the spooky month of October. In this blog post, we will present some tips on how your students can avoid student debt even before starting their higher education. Conversely, this means trying to spend the least amount of money possible.

To help your students, you should help them understand that they need to:

  1. Excel in high school: This means your students should try their hardest to get the best grades in their everyday courses as well as their college entrance exams, SAT/ACT. The higher their grades, the more likely a school will want them and offer money. If their grades are not the best, they should look into getting tutored by another student or teacher. Tutoring is a great way for you to go the extra mile and really help your student avoid debt in the future. Another important fact, is that universities want well-rounded students. It looks great when a student is involved in clubs and activities that show they are committed and can work well with others. Skills developed during extracurricular activities, such as sports and academic skills, can also yield to scholarships. It is crucial your students understand high school as an opportunity for their future.
  2. Enroll in free college courses: Many times, students do not realize that by “saving the hassle” and not taking advanced courses in high school, they are missing out on a great opportunity.  Advanced Placement, dual enrollment and summer courses provided by universities and high schools are the perfect way to save money. Students are able to take courses that will be required in college for free! Another suggestion you can give students that already know what they want to study, is to look into programs in their desired majors at local universities that also offer college credit.
  3. Focus on in-state schools: Are your students aware that the yearly tuition for a four-year out-of-state public school is around $25,600 and approximately $34,700 for a private school while an in-state public school is about $9,500? That is a big difference. While moving to a completely different state or traveling cross-country can be tempting for your students, it is important to persuade them to reconsider. They might be underestimating the amount of student debt they can potentially get themselves into. If they make time to compare school costs and quality of education, they will more than likely realize that in-state schools are more convenient.
  4. Consider different living situations: Another positive aspect about attending an in-state school is that students might be able to live at home and save money on rent. Let’s be honest, the first reason many students want to go to an out-of-state school is to become independent of their parents; however, they do not realize that living in dorms is not always the cheapest option. Living in a dorm can easily add $11,000 to a yearly tuition. If living at home is not possible and dorms are too expensive, you should ask your students to consider renting an apartment with a couple of friends. Usually, living off-campus is cheaper and investing in a bike can save your students from time consuming walks or spending money on vehicle expenses.
  5. Contemplate working part time: Usually, students are not thinking about working during their higher education either because they want to focus on school or they do not want to worry about a job until after their college graduation. However, working, at least, a part-time job while going to school can pay for some of their schooling so they do not have student debt or at least helps minimize any debt. A bonus to having a job while attending a university, is that it look great on resumes when they start applying for “real” jobs. It shows students are responsible and have good time management skills.
  6. Try to steer clear of private loans: As opposed to federal student loans, private student loans do not have a limit on how much students can borrow each year. Private loans are a slippery slope, and it can be very easy for students to go in over their head and end up in massive student debt. Additionally, private student loans have higher interest rates and do not offer accommodation repayment plans for students who struggle to keep up with their payments.

Join us at World Future Forum for more research findings and best practices on student debt!

Student Debt

During the month of October, we will focus on the scariest of topics: student debt. Student debt is at an all time high recently. Did you know that student debt has increased a shocking 145 percent since 2008? And that the average debt for a student who graduated with a bachelors degree in 2015 is around $30,000?

Dealing with a large debt while trying to find a job and, perhaps, looking for a place to live or moving back home can be very stressful. According to Student Loan Hero, over 70 percent of students reported suffering from headaches related to student debt stress. Other outcomes of student debt include: insomnia, physical pain and isolation due to depression and anxiety. This can be very dangerous as it can potentially cause disease and even death.

But do not worry! That is what World Future Forum is here for. There are many ways to avoid the toll student debt can cause in our students and, as educators, we can help. Stay tuned to find out ways to help your students confront student debt and learn how to manage it more effectively.

Join us at World Future Forum for more research findings and best practices on student debt!