Paying for College? SimpleTuition Offers Tips for Students Seeking Financial Information

Jul 12, 2007, 01:00 ET from SimpleTuition, Inc.

    NEWTON, Mass., July 12 /PRNewswire/ -- Many families max out savings,
 grants and scholarships to pay for college, but still come up short. This
 leaves many families at a loss to determine the most effective way to pay
 for higher education.
     SimpleTuition, Inc. (, a company dedicated to
 helping students and parents make sense of education financing choices, has
 a few tips to offer the cost-conscious college student and family.
     "Few students appreciate the cumulative amount of debt they are taking
 on," said Kevin Walker, CEO, SimpleTuition, Inc. "By carefully selecting
 the right options for financing - and monitoring their costs semester over
 semester and year over year, students will be better prepared for student
 loan repayment after graduation."
     SimpleTuition recommends students first look into federal student
 loans. Both subsidized and unsubsidized loans are backed by the Federal
 government and currently have a fixed interest rate of 6.8% -- generally a
 lower rate than what you'd find with private loans.
     Once federal loans have been exhausted - and to the extent that the
 family needs to borrow more - parents can consider the fixed-rate federal
 PLUS loan and students, together with a co-signer, can look into private
 loans to help pay the difference.
     Dozens of lenders offer private student loan products, each with its
 own set of interest rates, repayment terms, credit constraints, co-signer
 requirements and fine print. Because of this wide range of products, it's
 important for borrowers to research and compare options very carefully
 before applying.
     "Selecting a private loan should be your last choice and should
 represent the smallest percentage of your total financial aid portfolio, if
 at all possible," said Walker. "Remember that almost all private student
 loans have tiered pricing, based on the borrower's and co-signer's credit
 profiles. This means that lower interest rates and lower fees are available
 to those with stronger credit. Higher rates and fees are possible for those
 with weaker credit."
     SimpleTuition recommends:
     -- Avoid turning to credit cards to pay for college.  Many credit cards
        come with high interest rates.
     -- Put together a budget and do your best to follow it. By maintaining
        minimal expenses and managing current expenses now, students can lessen
        their borrowing needs and save money for when loans come due.
     -- A part-time job and/or federal work study can help more than you might
        expect.  Even if a job generates only a couple thousand dollars per
        school year - that amount can have a significant financial impact over
        many years, if student borrowing is reduced by a commensurate amount.
     -- Review education-related expenses, including student loan interest,
        when preparing your taxes.  There are a handful of meaningful tax
        credits and deductions that may be available to your family as an
        incentive to pursue a degree.
     -- Try to imagine your future situation (income and expenses) before
        taking out any student loan debt.  Industry experts advise that student
        loan payments should not exceed 8 to 10% of gross monthly income.
     -- Be aware of your debt - even though you won't begin repayment for
        years. Students should have a good understanding of what will be owed
        post graduation. The more you are aware of the obligation you are
        accruing, the more likely you are to be responsible about taking on
        more debt.
     For more information, visit

SOURCE SimpleTuition, Inc.