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How much should I borrow in student loans?

how much are my student loans

updated 1/6/2014

When deciding how much you should borrow in student loans, it helps to start with a budget for not only the school year but for your total expected time in school. For each additional year that you are in school and take out student loans, your total debt will continue to increase.

You should borrow only what your future earnings will allow you to repay. As a rough estimate, try not to accumulate more total student debt than you expect to earn as a starting annual salary when you leave school.

If your total student loan debt when you graduate were equal to your starting annual salary, at a current interest rate for federal student loans, your payment would be nearly 14 percent of your gross monthly income.

Contact your college’s career center to find resources to determine the salary you might be able to expect when graduating in your field.

Tip. Don’t borrow the maximum just because you are able to

obtain the loans. Borrow just enough to make sure your tuition, housing, and other expenses are fully paid after accounting for work earnings and any other sources of income.

Tip: As you continue to borrow additional student loans each year you are in school, you should keep track of your total student debt. The definitive source for your current loan balances of all of your federal student loans is the National Student Loan Data System (NSLDS). Your college financial aid office or your lender will have more information about your private student loan balances.

Of course, you should consider many other factors specific to your individual circumstances when determining how much debt you can handle. This is a personal decision that only you can make. You may also want to consider discussing it with your family and other trusted advisors.

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