More Hidden Costs of School | Student Finance 101

In a sequel to yesterday's blog post, Hidden Costs of School, here are 3 things that could mess up your school budget if you don't prepare for them:

1) Other interest costs.

In yesterday's post, I discussed the interest on your student loan. But now we're talking about the interest costs on credit cards, a car, private student credit lines and so on.

Some of these products have very high interest rates, like store and credit cards. Unless you can pay them in full every month, your debts could snowball fast.

As for the private student loans or credit lines offered by banks without government aid programs, these normally charge interest all the way through school, unlike government student loans. Even if they quote you a low interest rate, this charge will really add up after 4 or 5 years of school.

2) Your education may take a year longer than you expected.

Sometimes you can't get the courses you need at the right time-slots, so you have to stay another term or two to finish your credits. Or you change your major or you get sick or you need to take extra courses to raise your GPA to get into grad school.

An extra year of tuition and living costs -- or even an extra term -- may be required, so keep that in mind when you start your plans.

3) Realistic living costs.

If you've lived at home until now, you could be surprised at all the costs involved in living independently. Go over your budget with parents, older siblings or other adults who can remind you to budget for all those extras, from insurance and cleaning supplies to car repairs and dental emergencies.

For More Advice:

Our website (www.studentfinance101.ca) has lots of practical advice and savings tips to help students control their education costs.

However, my first suggestion would be for you to spend your first 1-2 campus years living at home if you can. If you can make this work, you could save thousands on rent and living costs. And you'll save even more if you can also attend a cheaper local campus during that time.

Remember, your degree will only show the place you graduated from. And if you can get that degree with less debt, you'll have more freedom to build a great career when you graduate.