Affordability and Student Loan Debt
Attending college is expensive. Here are some tips to help you achieve that IU degree without acquiring an unnecessary mountain of debt to go along with it.
The tuition rates at IU Bloomington, like at most major universities, are different for residents and nonresidents so the total cost of attendance is different depending on your residency. Direct educational costs include tuition & fees, room & board, and books & supplies. Indirect costs include transportation and personal expenses. Below is an estimated cost-of-attendance for new undergraduate students based on the 2014-2015 school year.
The most recent cost-of-attendance estimates for resident and non-resident students at IUB are always available on our Cost of attending IU page.
Most Students Receive Aid
68% of the undergraduate students at IU Bloomington received some form of financial aid in 2010-2011. Financial aid includes both merit and need-based financial aid such as scholarships, grants, loans, and work-study.
Net Price Calculator
IU Bloomington provides a Net Price Calculator that will assist students and their parents in the calculation of possible financial aid eligibility and an estimate of their net cost to attend IU Bloomington.
Thinking about Loans
An important part of managing your college debt is understanding the types of aid available to you. Generally, the broad categories of aid include loans, scholarships/grants, and work study.
- Student loans must be paid back to the lender, with interest, after graduation. Even if you don’t complete your degree, your student loans always have to be paid back to the lender.
- Scholarships and grants are considered gift aid and don’t have to be paid back.
- Work study is earned as wages through a part-time job, usually on or near campus.
More information about your different financial aid options can be found in our Types of Aid section.
Average Loan Debt of a Graduating Senior at IU Bloomington
About 40% of all undergraduate students at IU Bloomington used student loans to help pay educational costs in 2010-2011. The median student loan debt for graduating seniors at IU Bloomington in 2012 was approximately $27,000, which includes both federal and private student loans.
What loan amount you find acceptable will vary depending on the average income you expect to earn after graduation. In general, you should limit your total student loan debt to the amount of your first year starting salary for your profession.
What's your likely average starting salary? You can research it at salaries.com »
National averages for seniors with student loan debt are available from the Project on Student Debt.
Federal Student Loans v. Private Student Loans
Federal student loans come directly from the U.S. Department of Education and usually offer the best loan terms, including several different repayment options. Private student loans come from private banks and other financial institutions and often have higher overall costs with fewer repayment options.
More details on the differences between these two types of student loans can be found at studentaid.ed.gov.
Repaying Your Loans
What sort of financial impact should you expect when it comes time to repay your student loans?
Remember that we previously said the median student loan debt for graduation seniors at IU Bloomington was approximately $27,000 in 2012. On that $27,000, the payment would be approximately $311 per month based on 6.8% interest and a standard repayment term of 10 years.
Repayment Options for Federal Student Loans
There are several repayment options for Federal Direct Loans, each designed to meet the specific needs of student borrowers, including Standard Repayment, Graduated Repayment, Extended Repayment, and Income-Based Repayment.
When choosing a repayment plan keep in mind that the longer you take to repay the loan the more total interest you’ll be paying.
Default Rate on Student Loans for IU Bloomington Students
Very few IU Bloomington students default on their student loans. The average default rate for IU Bloomington students is 3.3% over the past 18 years (1992-2010). The national default rate for 4-year public schools is currently 5.2%.
You can learn more about student loan default by IUB students in our Repay Your Loans section.
Reducing Your Debt
10 Tips to Minimize Student Loan Debt
- Maximize the flat tuition rate. The flat tuition rate at IU Bloomington allows you to take up to 18 credit hours for the same cost as 12 credit hours. Work with your academic advisor to maximize your class schedule and take advantage of the flat tuition rate.
- Stick to your academic plan. Work with your academic advisor to stay on target to graduate in four years, or less. Adding extra semesters of study will increase the overall cost of your education. If you are exploring your academic interests with different courses, plan for the courses to count as needed electives or toward a minor
- Be sure to file the Free Application for Federal Student Aid (FAFSA) every year. This will allow you to take advantage of any eligibility you may have for need based grants and other gift aid before taking student loans.
- Stick with your prepaid meal plan. Use the money you’ve already paid for your campus meals and keep dining out to a minimum.
- Take advantage of free campus entertainment. There’re always free events around campus and it’s a great chance to meet other students with similar interests.
- Shop around when buying textbooks. Look for used books, book exchanges, or even e-books to help reduce your educational costs.
- Leave your car at home and save the gas and maintenance costs. IUB students can use the campus bus system as well as the city bus system to get around town so there’s no need for a car.
- Consider working part time. Not only does part time work provide you with some spending money, it also helps you develop time management skills and provides work experience you can add to your resume when you begin your career after college.
- Avoid using credit cards. Unpaid balances on credit cards are no different than personal loans with very high interest.
- If you must take student loans to pay for educational costs, borrow only what you need to get by for that academic period. Over-borrowing will add to your total loan debt and increase your repayment costs