How do you know if you can afford a particular college or how much is too much to take out in student loans?
One key indicator recommended by experts is a monthly student loan debt-to-income ratio of 8%–12%. An easier way to think of this is that total student loan debt, for all years of college, should be no more than the expected first-year salary.
ISL Education Loan's Student Loan Game Plan is an interactive online tutorial that walks students through this concept, as well as several other important points about borrowing for college, including:
- Stories about the issues faced by real-life borrowers when they took on too much student loan debt.
- Salary and borrowing information based on college major or career choice and existing debt.
- How in-college and after-college choices, including earnings, living arrangements and monthly spending, can affect overall student loan debt level.
- The ability to see how making voluntary interest payments during college affects total estimated loan repayment.
- Tips for reducing expenses and the need to borrow to pay for college costs.
Student Loan Game Plan is available free online.