Student Loans 101

Someone looking at a paper with student loan information and typing on a calculator.

Posted on June 3, 2022 Last Updated: June 3, 2022

Financing Options for Student Loans

The process of obtaining student loans can be incredibly confusing and intimidating, for both parents and students. The application process is time-consuming and there are deadlines that you need to consider when applying. The application process is just the first step to financing higher education. After the loans are funded, the interest rates you pay, and repayment plans add to the complexity of education financing. In this article, we cover what you need to know about student loans before and after graduation.

How to Pay for School

There are a few ways to pay for your higher education expenses. Roughly 45% of students rely on their parents to help pay for school either through cash or Parent Plus loans. Another 45% of students rely on either federal student loans and/or scholarships/grants to pay for their degree. The remaining 10% of students are self-funded or rely on private student loans. Whichever category you fall into, you’ll want to be sure to explore all of your options before settling on a plan to pay for college.

What is the FAFSA?

If you are one of the many students preparing for college financing, you may be familiar with FAFSA (Free application for federal student aid). This is an online application where you and your family disclose your financial situation and the cost of the school you plan on attending. This application will be used by the federal government, as well as your school and other committees that provide scholarships and/or grants, to determine how much financial aid you qualify for. No matter your personal, or your family’s, financial situation, you should fill out the FAFSA as a starting point before exploring all funding options. The annual enrollment window opens every October 1st, so mark your calendar to get your application in early.

What if I’m Already Attending/Graduated College?

For those who are already attending/graduated college, and have their funding sorted out, there may be other money-saving options to explore. Be sure to check your loan’s interest rate and compare it to the interest rates associated with a student loan refinance. There is a chance that the current interest rates associated with your federal and private student loans are higher than the current market rates, which means your loan will cost you more over time. Or, you may benefit from combining all of your loans into one for convenience.

What if My Rate is Higher Than What Lenders Are Offering Today?

If you find yourself in this situation, don’t worry, you’re not alone. Until recently, interest rates have been historically low, so there are plenty of people in the same exact position. If you find yourself paying higher interest rates on your student loans, you may be able to refinance them at a lower rate, which will potentially lower your monthly payment and save you money in the long run. Plus, you’ll want to keep your eyes on the news as student lending is constantly evolving with new opportunities!

KEMBA offers competitive Loan Rates

We offer our members great rates on student loans as well as student loan refinances. We offer both variable and fixed rates that will help you pay down your student loans faster and save you money in the process. If you would like to know more about KEMBA’s student loan services, contact our dedicated local associates for help and guidance on the process. Call 614.235.2395 and select Option 2 for more information.


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