5 Financial Questions Every College Student Should Ask Themself
When it comes to your college career, and your subsequent move into a new profession, there are many ways you can set yourself up to succeed financially. Asking the right questions now will ensure that you are on the right path to be financially independent after college. You’ll want to make sure you can pay off your student loans while still maintaining your credit score. This can be rough for many individuals fresh out of college, especially since your integration into the workforce can begin with a few years of earning a lower pay than you’re worth. Here are five questions to ask yourself today to ensure that you can handle anything life throws at you now, and in the future:
Do I Qualify For Any Scholarships?
You might think scholarships are only for straight-A students with a stellar docket of extracurricular achievements. This isn’t true at all. In fact, there are scholarships available to students from all walks of life, with all sorts of educational history. Even those with a GED can qualify for certain scholarships.
That being said, earning a scholarship isn’t necessarily easy. For most of us, it’s a numbers game: the more scholarships you apply for, the higher chances you have of receiving one. Start searching online as early as possible, and apply for as many as you can. You’d be surprised at the number available to you. Even if you’ve been in college for years, there are options for you. Spend a little time finding them and you won’t regret it.
Should I Consider Starting With Community College?
Community colleges generally offer two year (or less) programs meant to provide a certificate or associate’s degree in a specific field. They are a great resource for those looking solely for vocational education, or those who’d like a higher paying job fast.
Community colleges are also a great resource for those seeking a bachelor’s degree. Most community colleges will offer associate’s programs that will correlate to your desired degree, and their credits are highly transferable. If you move on to a university in the same state, it’s likely that there is a transfer program that will allow you to transition smoothly from one school to the other with zero loss of credits or wasted classes.
The best part? Community colleges are less expensive than traditional universities; much less expensive. In fact, starting out with community college could save you $80,000 over the course of your education, and you’ll still have a bachelor’s degree from your school of choice when you’re done.
Should I Worry About Deducting School Expenses From My Taxes?
Whether you or your parents are fronting the bills for school, it’s important to keep education expenses in mind when filing taxes. Almost anyone can deduct tuition and fees from their taxes. As long as you cannot be claimed as anyone else’s dependent, you are not classified as married filing jointly, and your modified adjusted gross income is under $80,000 (or $160,000 if filing jointly,) your college tuition is deductible. You can deduct expenses for your spouse or your dependent under the same restrictions as well.
You can also check to see if you qualify for any school related tax benefits. There are two major tax credits that are often overlooked: the Lifetime Learning Credit and the American Opportunity Tax Credit. School is expensive enough as it is, so make sure you are getting every last dollar back on your taxes.
Should I Worry About My Credit Rating In College?
The answer to this question is a very solid yes. As soon as you are 18, you should always have this issue in the back of your mind when making financial decisions. Your credit is going to follow you around for the rest of your life, so it’s important to understand your credit score and why it matters. A few small mistakes today can really have an impact later on, which won’t be ideal when you’re trying to launch a new career, pay off student loans, and start looking into things like buying a house.
On top of that, your credit score is considered a representation of your character and general reputation, which can impact you negatively when you try to put your degree to use. More and more employers are looking at credit reports as part of the hiring/background check process, even those who are not involved in the banking or financial industries. College is a good time to experiment and learn from your mistakes, but when it comes to your credit, you should always try your best to make wise decisions.
What Financial Factors Should I Consider When Looking For A Job?
When you’ve got your degree in hand and you’re hot on the hunt for a job, you have a lot to worry about. One of the many factors that should go into your career decision is your ability to pay back your student loans. On the one hand, it may be wise to get your foot in the door of a great company, even if it means starting with a lower position or salary than is ideal. On the other hand, if pay is so low that you can’t afford your loan payments on top of your living expenses, you might have to consider other options.
There are several factors to consider when looking for a career. The first is pay: does it pay enough to support you? The second is potential: does this carry the potential to pay well in the coming years, or to give you the experience and credentials you need to go after another position that will? The third is location: should I consider moving if employment opportunities or cost of living are not good in my home/college town, and if so, what are the best cities to live when paying off student debt? The fourth is future plans: do you have a wedding, a family, a divorce, or the possibility of an ailing parent who will need care looming on the horizon? If so, all of these factors can change your financial outlook drastically, so begin preparing for them as soon as possible, and factor them into your career decisions.
If all else fails, and you can’t find a job that pays well, or one that utilizes your degree, you have several options to help you through until you can. There are ways to reduce your interest rates or even achieve debt relief, so if you find yourself unable to pay all your bills, look into these before things get too bad.
The decisions you make now can make or break you financially, and they can also follow you throughout the coming years. It’s up to you whether the impact is negative or positive. Asking yourself these questions now could save you a lot of regret and a lot of hassle in the future. College is a stressful time in everyone’s life, but hopefully finances are something you won’t have to worry about too much.