In this column we will finalize our discussions about college costs and debt. As I have said, I hope that this three-part series will provide families and students with some tips, and, also, alert them to some important issues to think more about, research, and discuss. Then, the key is to turn it all into a focused action plan. In addition, as I have admitted, the information in this series is by no means exhaustive on these important subjects. Discussions with current college students and graduates of all ages can be very informative, especially if they can identify some mistakes that they or others they know have made. Then, there are helpful websites, articles, blogs, books, even government pamphlets, and more on these subjects that can be very informative and help create those business-like action plans.

When you have done all that we have suggested in this series, done your best academically in school and on any standardized tests, it’s time to complete the final Free Application For Federal Student Aid, apply for those non-school specific scholarships, and apply to a range of schools that you have identified could meet your academic needs and your financial needs, perhaps depending upon the financial package that you are offered, if you are accepted.

When those acceptances and related financial aid packages — which can be a combination of scholarships, work study, and various loans — come in, it is critical to understand all of the elements of the aid packages, including whether that is a one-year or a four-year package. Don’t hesitate to ask questions or to ask for a better package, especially if you have an acceptance and better package from another school. Bottom line — can you get the education you want and need, but, also, can you afford that school, and, if you are going to have to borrow to go there, will you be able to repay any loans without becoming an indentured servant to them for far too long?

Once you have that “right” school, and you are ready to begin your journey there, here are some things that you should consider:

• Now that you know the school and its location, build a realistic budget that you can stick to at that school. How can you make every dollar that you or your family is paying or borrowing go as far as possible? Any and everything that you can do to be frugal in your spending, and to be honest about needs vs. wants, wishes, conveniences and luxuries, will make a big difference. Here are just a few tips. Avoid impulse buying on the internet, consider using more cash, get together with others to buy in bulk at discount stores or clubs, and look for free things on campus or student discounts in town. Keep updating the budget as things change, for example you move off campus. There is an old saying, “if you live big in college, be prepared to live small later.”

• Implement that “graduate on time commitment” we have discussed. It will require you to take 15 credits a semester in order to graduate on time in a four-year program, which, in many schools, will require you to be proactive and all over that college catalogue, because schools are not always staffed up for four years, given the national graduation rates. Every day you are there more than on time, is more you will spend or borrow. What sense does that make?

• Work hard and graduate as high in your class and major as you can. It may mean a better job in today’s highly competitive world, which will make a difference in paying down any loans you may incur.

• If you have to borrow, avoid private student loans as much as possible. They generally have higher interest rates than government loans, and fewer repayment options that you may need someday. Read and understand all of the terms, conditions and deferment and repayment options of each loan. No surprises later! Then, my rule of thumb is that when you graduate, your monthly student loan payment should not be more that 10% to 15% of your monthly salary. To make that happen, as you go along you need to have researched likely salaries, and calculated the 10-, 20-, and 30-year repayment amounts for your total debt each time you borrow more.

• Never use student loan money for lifestyle — just room, board, tuition, or the equivalent. It’s not for more concerts and spring break trips. Consider working at the best-paying jobs possible in the summer and at school if you have student loan debt, and always stick to that budget that you are constantly updating.

• If you will graduate with student loan debt, don’t have credit card debt on top of it.

• If you have government student loans that accrue interest while you are at school, do what you can to pay it as you go, so that it doesn’t get capitalized at the end, and cost you much more.

• If you will graduate with student loan debt, do absolutely everything and anything that you can to pay it down as soon as possible, so that it doesn’t affect your lifestyle and career choices for longer than necessary. If you can, and it is allowed under the loan terms, make additional payments or pay more with each payment, to be applied to the principal, just like adding more to your monthly mortgage payment.

• If you will graduate with student loan debt, look for work at the increasing number of employers offering student loan payment money as an employee benefit. Also, look at income-based repayment plans, and other forgiveness programs, but make sure that you really understand all of the ongoing requirements if you get accepted. Too many people have been burned by those terms. Also, look at consolidation and deferment options, but, again, read everything, and really understand what you are getting yourself into.

From the beginning to the end, you must be analytical and business like about college costs and student loan debt. I hope that this series will provide a good head start.

John Ninfo is a retired bankruptcy judge and the founder of the National CARE Financial Literacy Program. Find his previous weekly columns at or at