Your student loans have been disbursed to your account, hurray! Tuition is covered and so are your books, but your housing situation still needs attention. Where’s that money going to come from? If you are considering using student loans for living expenses, or are looking for other options, check out this list of ways to help cover living expenses while in school.
Can I Use Student Loans to Cover Housing and Living Expenses?
Tuition is not the only thing your student loans can cover. Your loans can cover your college’s cost of attendance , which includes indirect and direct costs like books, transportation, and an allowance for room and board as determined by your institution.
So, you want to cover rent and that Spotify subscription with your student loans? It is important to remember that not everything can be covered by student loans, so here’s a short list directly from the federal
What is Covered by Federal Student Loans
• Room and board
• Institutional fees
• Dependent care expenses
• Commuting expenses
• Rental or purchase of a personal computer
• Loan fees
• Other documented, authorized costs
Other qualified expenses may include housing utilities, housing supplies and furnishings, and meals and groceries. But what about that Spotify subscription? Unfortunately, student loans cannot be used to cover entertainment costs. There’s actually a few things that aren’t covered by your federal loans.
What is NOT Covered by Federal Student Loans
• Travel or vacations (ahem, cannot be used for spring break)
• New vehicle
• Down payment on a house
• Frequent dining out or expensive meals
• New wardrobe
• Small business expenses
• Other debt
• Someone else’s tuition
Okay, so you know what is and isn’t covered, but how can the government really tell if you are using the loans correctly? It’s a bit of a gray area, especially if you deposit any loan refund money into your bank account that’s mixed with other income.
The use of student loans for non-qualified expenses can be reported to the Office of Inspector General as fraud, abuse, mismanagement, or violation of the laws and regulations that govern federal student loans.
Covering Living Expenses While in School
Aside from using student loans, there are several ways to cover living expenses while in school. Here are just a few.
Yes, as much as it sucks to skip hanging out with friends on Friday night, picking up a part-time job could help cover the cost of living expenses while in school. In 2019, 44% of full-time undergraduate students worked part-time jobs, according to data published by the National Center for Education Statistics (NCES) .
It could be a good idea to opt for a part-time job that allows flexible hours that fits into your class schedule. Some students may also be able to find part-time jobs related to their major or career-of-choice, allowing them to hone skills they’re learning in the classroom.
There is a finite amount of time during the week, so students who work while pursuing their undergraduate degrees may improve their time management skills, because they are forced to study and complete assignments during off work hours.
Students struggling with time management may want to consider tips like setting (and sticking to) a work or study schedule and limiting distractions and procrastination.
Some may find that a time management plan like the pomodoro technique may help them focus. To use the Pomodoro technique , set a time for 25 minutes and pick a specific task to work on, such as studying for that microbiology exam or reading for that international politics class. After 25 minutes of work, you can take a short (three to five minute break). After four focused 25-minute work sessions, you can take a longer (20 to 30 minute) break.
Federal Work-Study may also be a good option for students who qualify for the program. Federal work-study is offered as a part of a student’s federal aid package and is awarded based on financial need.
Work-study programs are available to undergraduate, graduate, and professional students, regardless of whether you are a part-time or full-time student.
Jobs are typically on campus, but may also be off-campus. Generally, work-study jobs will work with students to accommodate their class schedules. One drawback here is that you can’t just work as many hours as you want. Allotted work hours are determined by the financial aid package you received.
Becoming a Resident Assistant
Another way to pay for room and board, or to help cover a portion of the cost, is to become a Resident Assistant or Advisor (RA). An RA is usually assigned to a particular floor or wing of a dormitory to oversee dorm residents. Not only do you typically get a better room than others on your dorm floor, you also get free housing.
RA responsibilities might include organizing and leading mandatory floor meetings or monthly social gatherings. And it’s possible for an RA to end up refereeing roommate disagreements, too, but hey, it could be worth it to eliminate the worry of paying for room & board.
Another way to cover housing and living expenses (and tuition, quite frankly) is through awarded scholarships. There are many scholarships available from private companies, nonprofit organizations, universities and colleges, and professional and social organizations.
Take an afternoon to research available scholarships that you might be eligible for, paying attention to scholarship requirements.
Scholarship awards may have certain conditions, such as requiring that the money only be used for tuition.
On the other hand, scholarship awards may be delivered directly to you to use on whatever you want. Bottom line: consider applying!
As an alternative (or an addition to) a part-time job, consider a summer job or paid internship. During the summer, students may have more free time to work more hours and rack up cash to help cover their housing and living expenses for the following year.
One way to determine how much you need for each semester is to get an estimate of housing and living expenses.
For example, if you plan on living with a roommate and splitting the cost of an apartment that runs $800 per month, you’ll likely need at least $400 per month for rent. Factor in the likely cost of utilities, internet, groceries, and other monthly living expenses to get a rough estimate.
Divide the total cost by the number of months you plan to work over the summer. You can see how much you’ll need to save each month and if you may need to pick up any extra hours to cover the tuition. It may make for a busy summer, but it just might beat working through the school year.
Selling Unused or Unwanted Items
A quick way to cover housing and living expenses without going into more debt can be to sell unwanted items on buy and sell apps and websites.
Brand name clothing can be sold on apps like Poshmark and unwanted household items, electronics, and more can be sold on apps like OfferUp . It may not cover a whole month’s worth of living expenses, but it may cover a utility bill or a few groceries.
Federal student loans can be used to cover qualified living expenses, such as room and board. They can’t be used to pay for things like a spring break trip or other forms of entertainment. Students can prepare for anticipated living expenses by researching housing costs up front.
After graduation, students may consider refinancing their student loans to secure a lower interest rate or preferable loan terms. Because refinancing federal student loans eliminates them from borrower protections like income-driven repayment plans, this won’t be the right choice for everyone.
But qualifying borrowers who secure a more competitive interest rate may be able to save money in interest over the life of the loan.
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