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If you’re looking for a new home, you may be wondering when is the best time to buy. There are a number of factors that go into deciding when to purchase a house, from buying when interest rates are low to the times of the year you’re most likely to get a deal. Ultimately, when you decide to buy will depend on your financial situation and local market factors.

Here’s how to determine the best time to buy a house.

Do a Financial Checkup

Before going down the rabbit hole of timing the real estate market or watching the Federal Reserve like a hawk, it’s a good idea to explore if buying a home is right for your current personal and financial situation. There are a number of signs that can help you know if the time is right to buy a house.

First, is your budget big enough to cover any required down payment, closing costs, a mortgage payment, and other costs associated with homeownership?

Second, do you plan on staying put for a while, which may give the home you buy time to appreciate in value (subject to market fluctuations)? Also, consider whether you will benefit from itemizing and potentially deducting your home interest.

If you answered yes to those questions, it’s a good idea to check on your credit. A better overall financial profile and credit history may help you secure better financing terms when you purchase a home. And finally, take a look at whether rent in your chosen area is relatively high compared to the cost of homeownership. Should you buy or rent? If you can rent a home in your city for much less than what you would pay in mortgage payments, it may not make sense to make a purchase right now.

If your budget for buying a house and your credit are strong, you’re prepared to stay in the new house for the long haul, and importantly, that renting is relatively costly compared to buying, you may be ready to buy a home. Now you can begin looking at other factors to decide when to start house hunting.


💡 Quick Tip: When house hunting, don’t forget to lock in your home mortgage loan rate so there are no surprises if your offer is accepted.

Watch Interest Rates

One major factor to consider when deciding whether to buy is interest rates. Banks charge interest to cover the costs of loaning you money when they offer you a mortgage. The mortgage interest rate banks charge is influenced in part by the Federal Reserve, but mortgage backed securities are considered the main driver.

If interest rates are low, borrowing money is cheaper for you. Borrowing gets more expensive as interest rates increase. So if you think interest rates are going to rise soon, buying a home now with a fixed-rate mortgage loan may allow you to lock in better terms than you might otherwise get in the future. Conversely, if you think interest rates are high, it may be worth waiting to see if they’ll drop.

Time the Real Estate Market

The idea behind timing any market is that you buy when prices are low and sell when prices are high. Ideally, you would buy your home when there are more sellers than there are buyers, a situation known as a buyer’s market.

In a buyer’s market, the overabundance of housing options drives down the price of homes. Additionally, it may give you leverage to ask for more concessions from sellers desperate to close a deal, such as giving credit toward the buyer’s closing costs or covering the cost of repairs or new appliances.

In a seller’s market, the opposite is true. More people want to buy than there are houses available for sale and housing prices are driven up.

To identify what times may be beneficial to be a buyer, there are a number of factors you can watch. First, take a look at pricing trends in your area. Use real estate websites like Zillow, Redfin or Trulia to see what houses have sold for in your chosen area.

If prices are low or seem in line with historic trends, it could be a good time to buy. If prices are much higher than they have been historically, it may not be the ideal time to buy, and/or the area may be experiencing a real estate bubble. Bubbles tend not to be sustainable, but many factors play into real estate market conditions.

You can also take a look at how long houses in your desired area are sitting on the market. If houses in good condition are taking a long time to sell, it could mean demand is low and the market is in your favor.

Additionally, examine larger economic factors such as new construction and months of supply. When fewer houses are being built, demand and prices are higher.

The government keeps track of new residential construction. Visit the U.S. Census Bureau to take a look at current trends.

Months of supply is a measure of how many months it would take to sell the current number of houses on the market in your area at the current rate of sale. To do this, divide the total number of homes for sale by the number of homes sold in one month. For example, if there are 40 houses on the market and they are selling at the rate of 10 a month, there are four months of supply. When this measure creeps above six months of supply, it generally indicates that it’s a buyer’s market.


💡 Quick Tip: To see a house in person, particularly in a tight or expensive market, you may need to show the real estate agent proof that you’re preapproved for a mortgage. SoFi’s online application makes the process simple.

Understand Your Local Market

Real estate is generally considered a location driven market, so prices can vary widely from area to area, and general rules of thumb regarding pricing may not be applicable in every case. The same can be true of particularly desirable neighborhoods within a city.

Local economics can also play a part in housing demand. Say a large company leaves a city sending its manufacturing overseas. That city may experience an economic downturn that puts downward pressure on house prices.

This local variation means that it’s important to pay close attention to economic and housing trends in your chosen area. That way you’ll be more likely to find the best time to get your dream home.

The Takeaway

Figuring out the best time to buy a house first involves taking stock of your financial and personal situation. Make sure you have enough money saved up to cover the costs of buying plus your mortgage payment, and review your credit history to make sure it’s strong.

Then, look at rental prices compared to home prices in your area to see whether buying makes financial sense for you. Assess the interest rates to see if home buying is affordable, and look at the trends in the real estate market to determine how favorable they are as you start house hunting.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

SOHL1023252

Graduate school can help you pursue your academic and professional interests, expand your connections, improve your marketability, and increase your earnings. But it often comes with a high price tag.

If you’re thinking about investing in your future by attending graduate school, you may be wondering, does FAFSA cover graduate school?

In short, yes. Just like undergrads, graduate students can fill out the Free Application for Federal Student Aid (FAFSA) every year in order to qualify for federal grants, work-study, and federal student loans.

Read on to learn more about getting financial aid — and other types of funding — to help pay for graduate school.

Do You Have to Fill Out FAFSA for Graduate School?

While filling out the FAFSA is not required to attend graduate school, students who are interested in receiving federal student aid as graduate students will need to fill out and submit the form.

You may be familiar with the FAFSA from your years as an undergraduate student. The process of getting financial aid for graduate school is basically the same, with eligibility largely determined by financial need.

However, there is one notable difference: Graduate students are considered independent students for FAFSA purposes, so you aren’t required to provide any information about your parents’ finances. Another difference: For the 2025–26 FAFSA form, if you’re married, you’ll need to provide your spouse’s information.


💡 Quick Tip: You can fund your education with a low-rate, no-fee private student loan that covers all school-certified costs.

Grad School Financial Aid Eligibility

To be eligible for financial aid in graduate school you must meet basic FAFSA requirements. These include being a U.S. citizen (or qualifying noncitizen) enrolled or accepted in an eligible degree or certificate program. If you have any criminal convictions, have previously defaulted on a student loan, or owe a Pell Grant overpayment, that could affect your eligibility for federal aid.

FAFSA doesn’t have a maximum income cutoff, so it’s worth applying even if you have a steady income. There is also no age cutoff for financial aid, so you can complete and submit the form whether you graduated college recently or many years ago.

Some financial aid is awarded on a first-come, first-served basis, so it’s generally a good idea to fill out the FAFSA as soon as possible after its release. Due to an overhaul of the form, the FAFSA for the 2025-26 academic year will be released in stages: The first group of students will get access on October 1, 2024, with the remaining applicants receiving access on or before December 1, 2024. Be sure to submit your FAFSA form by the earliest financial aid deadline of the schools to which you are applying, which is typically early February.

Here’s a look at what type of financial aid you may be eligible for as a graduate student.

Grants

Your financial aid package for graduate school may include federal and state grants based on your field of study, interest, or type of school.

For example, if you’re studying education, you might be eligible for the Teacher Education Assistance for College and Higher Education, or TEACH Grant. The TEACH grant provides up to $4,000 a year to education students who will teach in a low-income school or high-needs field after graduation.

Graduate students can also qualify for federal Fulbright Grants and Iraq and Afghanistan Service Grants. However, grad students are generally not eligible for the Pell Grant or Federal Supplemental Educational Opportunity Grant (FSEOG) Grant, which are largely reserved for undergraduates.

You can learn about state-based grant opportunities by contacting the department of education for your state, as well as the state where the graduate school is located.

Many graduate schools also offer grants based on financial need or academic excellence. These grants generally don’t need to be repaid, although there may be specific stipulations, such as maintaining a certain GPA.

Recommended: Grants For College – Find Free Money for Students

Work-Study

You may be familiar with work-study programs from your time as an undergraduate student. Graduate students are also eligible for the Federal Work-Study Program, which provides part-time jobs to students who demonstrate financial need.

Work-study is available to both full- and part-time students, though your graduate school must participate in the Federal Work-Study Program. Your school’s financial aid office can give you more details about the work-study program and the types of jobs available to you. Your program may also offer assistantships or teaching roles to help you pay for school (more on that below).

Federal Student Loans

The federal student loans you can access in graduate school are slightly different from those you can take out in undergraduate school. For example, you cannot take advantage of Direct Subsidized Loans, which are loans in which the government pays the interest while you are in college and during the six month grace period after you graduate. Direct Subsidized Loans are only available to undergraduate students with demonstrated need.

Here’s a look at the two types of federal loans available to grad students.

Direct Unsubsidized Loans

Federal Direct Unsubsidized Loans are loans made to eligible undergraduate, graduate, and professional students, but eligibility is not based on financial need. And, unlike a Direct Subsidized Loan (which is need-based), the government does not pay the interest while you’re in school or for six months after graduation. Interest will accrue while you are attending grad school and get added to your loan balance.

The interest rate is higher on Direct Unsubsidized student loans for graduate students than it is for undergraduate students.

If you are a graduate or professional student, you can borrow up to $20,500 each year in Direct Unsubsidized Loans. The interest rate is fixed at 8.08% for loans first disbursed between July 1, 2024, and July 1, 2025.

Grad PLUS Loans

If you need to borrow more than the annual limit for Direct Unsubsidized Loans to pay for grad school, you can also access a Federal Grad PLUS loan, which is also called a Direct PLUS Loan.

These federal loans are exclusively for graduate/professional students and parents of dependent undergraduate/professional students. Eligibility is not based on financial need, but a credit check is required. Borrowers who have an adverse credit history must meet additional requirements to qualify.

Grad Plus Loans are the most costly type of federal loan. For loans disbursed between July 1, 2024, and July 1, 2025, the interest rate is a fixed 9.08%. You’ll also pay a one-time disbursement fee of 4.228%.

Grad Plus Loans come with higher borrowing limits than other types of federal loans. You can borrow up to the cost of attendance of your graduate school program minus other financial assistance you get.

To apply for a Grad PLUS Loan, you need to fill out the Direct PLUS Loan Application.

Tips on Filling Out FAFSA as a Grad Student

Filling out the FAFSA as a graduate student is similar to filling out the form as an undergrad. However, your dependency status will differ because you’re no longer considered a dependent student. As a result, you typically do not need to input your parents’ information onto the FAFSA. You’ll only need to supply information about your (and if, you’re married, your spouse’s) income and assets, the graduate schools you want to receive your FAFSA information, and then sign and submit your form.

When Will You Hear Back?

It typically takes the education department three to five days to process the FAFSA if you submitted electronically; seven to 10 days if you mailed in a paper form.

If you provided a valid email address, you’ll receive an email notification that includes a link to your electronic Student Aid Report (SAR) at fafsa.gov. You’ll get a paper SAR through postal mail if you didn’t provide a valid email address. You’ll want to review your SAR carefully to make sure it’s complete and accurate and correct/update information if necessary.

The graduate schools you apply to will then review your FAFSA information and other documents and send you a financial aid award letter that details the scholarships, grants, and federal student loans you are eligible to receive. You may receive your financial aid award not long after you receive your acceptance letter to the graduate school. However, every school is different, so it’s a good idea to ask the admission or financial aid office of your school for more information.

Average Disbursed Amount

The average graduate student loan debt balance (from graduate school alone) is $78,118, according to the Education Data Initiative.

The maximum amount you can borrow under the Federal Direct Unsubsidized Loan program for graduate school is $20,500 a year, with a maximum lifetime limit of $138,500 (including undergraduate loans).

In comparison, a Grad PLUS Loan allows you to borrow up to the cost of attendance, minus any other financial aid received.

FAFSA for Grad School vs Undergrad

Graduate school financial aid is similar to undergraduate financial aid, but there are a few key differences. Here’s a look at how the two compare.

Alternatives to Federal Aid

Federal aid isn’t the only way to pay for graduate school. Here’s a look at some other sources of funding.

Private Student Loans

Private student loans are offered by banks, credit unions, and online lenders. Unike federal student loans for graduate students (which come with fixed interest rates), private student loans may have fixed or variable rates.

Interest rates are set by the lender, so it can pay to shop around to find the best deal on a private student loan for grad school. Generally borrowers with excellent credit qualify for the lowest rates.

Similar to Grad Plus loans, you can usually borrow up to the full cost of attendance from a private lender. However, Grad Plus Loans come with a disbursement fee, while private lenders generally don’t charge this fee. If you have excellent credit (or can recruit a cosigner who does), you could potentially pay less with a private graduate student loan than a Grad Plus Loan. Keep in mind, though, that private student loans don’t offer the same protections (like access to forgiveness programs and income-based repayment plans) that come with federal student loans.


💡 Quick Tip: Master’s degree or graduate certificate? Private or federal student loans can smooth the path to either goal.

Grants and Scholarships

You’ll be eligible for federal, state, and institutional grants by filling out the FAFSA. However, there are also funding opportunities available outside this system. Many private organizations have created grants and scholarships to help graduates pursue an education in the fields they support.

Look for scholarships and grants from professional associations in your field. Your graduate school department or career department can often help you find scholarships based on your qualifications. There are also several scholarship websites to help you find money for graduate school, including Fastweb and Scholarships.com.

Fellowships and Assistantships

Graduate fellowships and assistantships can both help you pay for graduate school but they work in different ways.

A fellowship is like a scholarship that you can use for any costs you incur as a student. These programs are often available from professional organizations relating to your major. With a fellowship, you may perform research activities on campus or outside of your school.

An assistantship, on the other hand, is typically school-based and more likely to directly provide full or partial tuition waivers. Some assistantships also come with living stipends. An assistantship typically involves doing work on campus, usually related to your major. You might get a research job, which often entails assisting a tenured professor on an upcoming study, or you could secure a teaching job, which gives you the chance to serve as an assistant or professor at the school.

Employer Tuition Assistance

If you work for an employer that offers tuition assistance, your company may cover some or all of the costs of your graduate or professional education as long as you meet the program’s eligibility requirements.

You may even be able to access tuition assistance through a part-time job. Your human resources office will have details about tuition assistance, qualifications, and reimbursement procedures.

The Takeaway

Just like undergrads, grad students can qualify for financial aid to pay for school. Your grad school aid package might include grants, work-study, and federal loans.

As a grad student, you can take out more in federal loans than you could as an undergrad, which may make it easier to attend a more expensive school. It’s generally a good idea to tap lower-cost Direct Unsubsidized Loans before considering PLUS Loans.

Other sources of funding for grad school include: private grants, scholarships, fellowships, assistantships, and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

How much can FAFSA disburse for graduate school?

As a graduate student, you can borrow up to $20,500 in unsubsidized federal loans each year. Grad PLUS Loans are also an option, and allow students to borrow up to the cost of attendance for graduate school.

Graduate students may also qualify for grants (which don’t need to be repaid) and work-study by filling out the FAFSA.

Is it harder to qualify for financial aid as a graduate student?

Not necessarily. While there are fewer need-based aid options for graduate students, your university or graduate program might provide merit- or research-based assistance. In addition, many private and nonprofit organizations offer scholarships and grants for graduate students.

Do you need to make a new FAFSA account for graduate school?

No, you do not need to make a new FAFSA account for graduate school. If you created an FSA ID as an undergraduate, you can use the same ID to apply for financial aid for graduate school.

Photo credit: iStock/sturti

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SOIS1023010

Some students view summer as a time to rest and relax, while others see it as an opportunity to get ahead in their college coursework. Since many classes can be done at a community college, summer courses may also cost less than the classes you take during the fall and spring semesters.

If you’ve already sorted out your financing of the fall and spring semesters, you may wonder how you’ll cover the cost of a summer session. The good news is that the aid you get through the FAFSA can typically be used to pay for summer classes too. Here’s what you need to know.

When Can FAFSA Cover Summer Classes?

Filling out the Free Application for Federal Student Aid (FAFSA) gives you access to grants, federal student loans, and work-study funds. Whatever aid you qualify for can be used for any term — fall, spring, and/or summer — provided you’ll be enrolled at least half time.

However, you’ll have to reach out to your school’s financial aid to find out which FAFSA year applies to the summer session. For instance, your school may use the 2023-24 for summer 2024, or they may require the 2024-25 FAFSA.

The type of financial aid you can use to offset the cost of summer classes includes:

•  Grants This is a form of gift aid and generally does not need to be paid back. You may be eligible for federal, state, and school-specific grants.

•  Federal student loans These are fixed-interest-rate loans from the government. Students with financial need may qualify for subsidized student loans. This means the government covers your interest while you are in school and for six months after you graduate. Unsubsidized student loans are available to all students, regardless of need.

•  Work-study This federal program provides part-time work, typically on campus, to help students with financial need earn money to help cover college-related expenses.

If you’re thinking of using financial aid to pay for summer classes, keep in mind that there is a maximum amount of aid (including federal student loans) you can get each year, regardless of when you take your classes. You can refer to your financial aid letter (which you likely received before the fall session started) to see the maximum amounts you have been granted. These annual limits stretch over fall, spring, winter, and summer sessions.


💡 Quick Tip: Make no payments on SoFi private student loans for six months after graduation.

Filling Out FAFSA for Summer Aid

The FAFSA is generally released each year on October 1. However, the 2024-25 FAFSA is an exception. Due to an overhaul (and simplification) of the form, the 2024-25 FAFSA will be available in December 2023. Since some aid is awarded on a first-come, first-served basis, it’s a good idea to fill out the FAFSA soon after it’s released. This can potentially increase your chances of getting all the aid you qualify for.

If you already have a FAFSA on file for the previous fall/spring academic year, you may not need to file a new one for the summer session. However, as mentioned above, schools have varying rules on what academic year they belong in for financial aid purposes. Before submitting the FAFSA, contact your college’s financial aid office to see if you need to fill out a new FAFSA and which year you should select.

Filling out the FAFSA for summer aid is the same as filling out the FAFSA for any term. You’ll need to create an FSA ID and then complete and submit your form online at studentaid.gov. You can also print out and mail a paper form.

Alternatives to FAFSA

If you don’t qualify for financial aid or you used up the aid you were awarded during the fall and spring semesters, don’t stress. There are other ways to offset the cost of summer classes.

Summer Jobs

If work-study is not available, you might look for a part-time summer job either on or off-campus to help pay your summer tuition. Working during the summer can also give you valuable work experience and help you start building your resume.

Internships

A paid internship can be an ideal summer job for a college student. These positions often pay well and allow you to gain experience and connections that can help you find employment after you graduate. Your school’s career center may have leads on summer internships. You can also search job boards and tap your personal and professional network to find summer internships.

Summer Class Scholarships

Many organizations, companies, and schools offer scholarships (both need- and merit-based) to college students. Typically, there aren’t restrictions on what term students can use the scholarship for, so you can apply for scholarships and use the awards to pay for your summer classes. Private scholarship amounts tend to be small, but if you can cobble together several awards, it could make a significant dent in your summer tuition.

Your school’s financial aid office or career center may be able to help you find scholarships based on your qualifications. You can also use one of the many online scholarship search tools to find scholarships you may qualify for.

Summer Grant Programs

Some universities offer grants that are designed specifically for students looking to take classes during the summer. For instance, California State University in Fullerton offers two summer tuition grants.

Many states also offer college grants that can be used for the summer term. The Pennsylvania Higher Education Assistance Agency, for example, allows eligible students to receive a Pennsylvania State grant for the summer term.

It can be worth reaching out to your school’s financial aid office to find out what summer funding programs may be available. Also visit the department of education for your state to see if there are any summer-specific state grants you might qualify for. Typically, institutional and state grants are need-based.

Private Student Loans

If you’ve reached your annual limit for federal student loans and need more funding to cover the cost of summer classes, you might consider applying for a private student loan.

These loans are offered by banks, credit unions, and online lenders and typically come with higher lending limits than federal student loans. In fact, you can usually borrow up to the full cost of attendance from a private lender, minus any financial aid. Interest rates vary by lender, so it can be a good idea to shop around. Generally borrowers (or cosigners) with excellent credit qualify for the lowest rates.

Keep in mind, though, that private student loans don’t offer the same protections (like access to forgiveness programs and income-based repayment plans) that come with federal student loans.


💡 Quick Tip: It’s a good idea to understand the pros and cons of private student loans and federal student loans before committing to them.

Why Take Summer Classes?

Whether you choose to study at your current college or a local community college, summer classes offer a number of benefits.

You might opt to go to school in the summer to retake classes you struggled with in the past in order to boost your GPA. Or if you’re behind in your credits, you might use the summer term to catch up and make sure that you can graduate on time. You can also use a summer session to knock out core or elective course requirements and fast track your degree.

Taking summer classes can also lead to cost savings. Some schools offer reduced tuition for these classes. You also might be able to take classes at a local community college for a lower price and transfer those credits to your school.

Recommended: Can You Get a Student Loan for Summer Classes?

The Takeaway

FAFSA aid can typically be used for any college term — including the summer. Just keep in mind that there is an annual maximum you can take out in federal loans, which includes the summer semester. Grants also usually have annual limits.

Other sources of funding for summer classes include private scholarships, summer college grants, income from a part-time job or paid internship, and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

FAQ

Do summer classes count as semesters for FAFSA?

Technically, yes. While there is no specific federal funding for summer classes, the aid you are eligible for can be applied to summer tuition. You can find out from your school’s financial aid office which academic year FAFSA will apply to summer classes.

Which year of FAFSA covers summer classes?

It depends on the college’s policy. For instance, your school might require you to fill out a 2023-24 form for the 2024 summer session or the 2024-25 form. Before submitting the FAFSA, you’ll want to contact your college’s financial aid office to see which FAFSA year you should select.

Is there a maximum amount that you can receive from FAFSA overall?

Yes. There are annual limits on how much you can receive in federal financial aid, which includes grants, loans, and work-study programs. The limit for each type of aid varies by school, year, and other factors. You’ll want to be careful to plan your expenses and financing strategies with these limits in mind.

Photo credit: iStock/Yuricazac

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SOIS1023011

Popular wedding sites claim the average wedding costs $29,000. Countless media reports have repeated that number while leaving out an important caveat: Averages can be misleading. Even one extravagant wedding may skew the average to be significantly higher than what most people actually paid.

SoFi wanted to know: How much does a wedding really cost? We surveyed 1,000 men and women across the country and then crunched the numbers. Read on to find out what we discovered.

50% of respondents’ weddings cost less than $10,000

Total wedding budget breakdown:

•   Less than $10,000: 50%

•   $10,000 to 19,999: 18%

•   $20,000 to 29,999: 12%

•   $30,000 to $39,999: 10%

•   $40,000 to $49,999: 6%

•   $50,000 or more: 4%

Half of respondents to our wedding survey spent less than $10K on their ceremony and reception. That’s considerably less than the $29K figure that’s been popularized as “average.”

We’re not saying that the $29K budget is inaccurate — after all, half of respondents paid more than that. However, averages in general are notoriously confusing. Only 22% of couples in our survey spent about $29K (between $20K and $39K). And just 10% paid more than that.

But why does this matter?

There’s a concept in behavioral economics called anchoring. It describes how numbers can influence consumer decisions by unconsciously becoming our reference point for what’s standard or “normal.”

Let’s say you’re in the early stages of wedding planning. If you stumble across an authoritative $29K estimate, from then on you may view anything less than that as a “low-budget” wedding. And when figuring out your own wedding budget, you may make decisions that bring you closer to that total — even if a $10K wedding is more aligned with your savings and taste.

The most common wedding regret? Spending too much money.

15% of respondents said their biggest wedding regret was spending too much money. Other common wedding regrets:

•   Type of wedding (traditional, elopement, courthouse): 10%

•   Letting other people dictate wedding decisions (guest list, location, bridal party): 10%

•   Drinking too much the night of the wedding: 9%

•   The guest list: 8%

You may have heard of a phenomenon called the “vacation mindset,” which drives travelers to splurge on special purchases they wouldn’t consider on their home turf. Well, a similar wedding mindset can push couples to indulge an uncharacteristic desire for luxury. “It’s a once-in-a-lifetime event! Your wedding should be as big as your love for each other!”

After the wedding, as the bills roll in, so does buyer’s remorse. And now, other big-ticket goals that took a backseat to the wedding — buying a home, having kids, expanding a business, or saving for the long term — now feel more urgent.

Nearly half (46%) of respondents who got married in 2020 or later had a nontraditional wedding (they eloped or got married in a courthouse).

•   9% of people eloped. Of those, 6% had a reception with friends and family later.

•   25% of respondents got married in a courthouse. Of those, 18% had a reception with friends and family later.

The pandemic likely drove many couples to forgo big group events in favor of smaller celebrations. But there are other reasons behind the popularity of nontraditional weddings, according to several wedding vendors we spoke to:

Financial goals:
“It’s no surprise that couples might want to scale back their wedding,” says Jim Campbell, founder of Honeymoon Goals. “They don’t want to spend years saving for an elaborate event when they could be saving for other things instead, like traveling together.”

Time:
“The last few years have shown people how much they value their free time,” observes Maddie Ward, of Sonnet Weddings. “Elopements and courthouse weddings are definitely lower-cost, but there’s also much less of a time investment in planning. The prospect of spending a year or more involved in a time-intensive endeavor with your partner has many people looking at alternatives.”

Stress:
“The No. 1 reason to scale back to a micro wedding or elopement is stress!” insists Lee Ramsay, of Lee Ramsay Events. “More guests means more money, and more money means more problems. Save your dollars, and avoid the headache of attempting to make everyone happy.”

The venue (23%) was among the biggest wedding expenses.

Of those who said the venue was the most expensive, the most commonly reported cost was $10,000 (11% of respondents). The most expensive venue cost reported? $500,000.

It’s safe to say that those who spent $10K on their venue had higher overall budgets. Those with smaller wedding budgets often got creative about the venue, choosing a park, beach, or private home or yard.

Other common ways people saved money on their wedding venue were:

•   Limiting the number of guests: 31%

•   Using buffet or family-style food service: 29%

•   Booking a venue that didn’t require additional rentals (chairs, tables, tents): 26%

Nearly two-thirds (62%) of respondents had expenses pop up that they weren’t prepared for.

The most common fee that snuck up on people? Marriage license and officiant fees: 23%.

Other common surprise costs reported by respondents:

•   Taxes and service charges: 17%

•   Pre-wedding events like the rehearsal dinner or welcome party: 15%

•   Meals for vendors: 13%

•   Overtime charges for vendors: 13%

•   Gratuities for vendors: 12%

•   Postage for stationery (invitations, RSVPs, thank you cards): 12%

82% of respondents who had a wedding planner said their planner helped them save money.

“Wedding planning is a lot like cooking. The more you do it, the better you get at it,” explains Jim Campbell. “The more weddings you plan, the better you get at saving money.”

According to The Knot, the average cost of a wedding planner is about $1,900. But a planner’s fee can vary widely widely depending on a number of factors:

•   Location: A destination wedding requires more coordination than a hometown ceremony.

•   Services required: A full-service planner costs more than someone hired to manage certain elements, such as the seating chart or budget.

•   Fee structure: Planners may charge a flat fee, hourly rate, or a percentage of your overall budget.

Only 25% of our respondents hired a wedding planner. (Another 13% said a planner was included with their venue.)

Ryan Mayiras, of Candid Studios wedding photography, thinks many couples don’t need a wedding planner. “Believe it or not, we recommend that most of our customers skip the wedding planner step. Good vendors will go out of their way to help couples plan their wedding,” he says. “We have a collection of timeline templates that we send to our customers for reference. They can skip the planner and go with a day-of coordinator instead. A coordinator is more affordable and will keep the event on schedule, so the couple doesn’t need to worry during the wedding itself.”

Who paid for the wedding?

39% of respondents said the couple paid for the total cost of the wedding on their own. Of this group:

•   70% said their wedding cost less than $10,000.

•   88% said it cost less than $30,000.

45% of respondents said their parents helped pay for the wedding. 27% said their partner’s parents helped pay.

Of those who said the food and drinks were the most expensive, the most commonly reported cost was $10,000 (10% of respondents). The next most commonly reported cost for food and drink was $1,000 (8% of respondents).

Those who said the rings were the most expensive reported a wide range of dollars spent. Regardless of the total wedding budget, many couples (35%) splurged on their rings. Here were some of the most commonly reported costs:

•   $300: 5%

•   $500: 7%

•   $1,000: 8%

•   $2,000: 7%

•   $2,500: 5%

•   $3,000: 6%

•   $5,000: 7%

Popular money-saving tactics

The most common ways people saved money on their wedding attire:

•   Shopped around for deals: 33%

•   Bought a dress off the rack: 26%

•   Rented suits: 23%

18% of people said they didn’t try to save money on attire.

The most common ways people saved money on their wedding vendors:

•   Did their own hair and makeup: 38%

•   Hired a friend to do photography/videography: 32%

•   Didn’t provide transportation for wedding party or guests: 30%

The most common ways people saved money on their wedding decor, stationery, and gifts:

•   DIYed decor: 26%

•   Didn’t give gifts to parents: 25%

•   Didn’t give gifts to out of town guests: 24%

Ashley Meyer of Meyer Photo Video offered other money-saving tips:

•   “Skip traditional paper invitations and stamps, and opt for email invitations.

•   “Save a few hundred dollars by asking a close friend or family member to get ordained online to officiate your wedding.

•   “Join local bridal Facebook groups to buy discounted wedding items from couples who already tied the knot. Couples sell everything from their wedding dress and veil to candles and signage.”

What couples splurged on

The most common splurge was the rings (35%). Other wedding items that respondents splurged on:

•   The food: 32%

•   The dress: 27%

•   The drinks: 23%

•   The venue: 20%

Many wedding planners we spoke with recommended splurging on photos. Yet only 17% of respondents said they splurged on photography/videography.

The real takeaway? Couples don’t have to splurge on anything. You may feel better after your big day if you save your splurging for a new home or fat retirement account.

Financing a Wedding

Should you need a bit of financial assistance to put your wedding savings over the top, a personal loan is a better option than high-interest credit cards. With low rates and no fees required, SoFi can put those final funds at your fingertips the same day as your approval. That way, rather than anticipating how you’ll pay the bills, you can relax and enjoy your wedding.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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The Internal Revenue Service (IRS) generally requires that you report a forgiven or canceled debt as income for tax purposes. But forgiven student loan debt is different.

The American Rescue Plan (ARP) Act specifies that student loan debt discharged between 2021 and 2025, and incurred for postsecondary education expenses, will not be counted as income, and therefore does not incur a federal tax liability.

This includes federal Direct Loans, Family Federal Education Loans (FFEL), Perkins Loans, and federal consolidation loans. Additionally, non-federal loans such as state education loans, institutional loans direct from colleges and universities, and even private student loans also qualify.

However, some states have indicated that they still count canceled student loans as taxable income. Read on for more information about which discharged student debt is taxable and by whom.

Different Student Loan Forgiveness Programs

Federal student debt can be canceled via an income-driven repayment plan (IDR) or forgiveness programs.

While President Joe Biden’s plan to offer federal debt cancellation of up to $20,000 to those with qualifying income failed — struck down by the U.S. Supreme Court — other forms of student loan forgiveness have been strengthened.

In October 2023, the White House announced at least $127 billion in student loan relief for nearly 3.6 million Americans:

•   $5.2 billion in additional debt relief for 53,000 borrowers under Public Service Loan Forgiveness programs.

•   Nearly $2.8 billion in new debt relief for nearly 51,000 borrowers through fixes to income-driven repayment. These are borrowers who made 20 years or more of payments but never got the relief they were entitled to.

•   $1.2 billion for nearly 22,000 borrowers who have a total or permanent disability who have been identified and approved for discharge through a data match with the Social Security Administration.

Recommended: Guide to Student Loan Forgiveness

Whose Student Loan Cancellation Is Not Federally Taxed?

As stated earlier, under the provisions of the ARP Act, any student debt (private or federal) for post-secondary education that was or is forgiven in the years of 2021 through 2025 will not be federally taxed. This means that the borrowers just listed above were not required to report their discharged loan amount as earned income, and therefore taxable.

Outside of the special five-year window of tax exemption provided by the ARP Act, participants in the Public Service Federal Loan program who receive forgiveness also don’t have to worry about paying taxes on the canceled amount. The program explicitly states that earned forgiveness through PSLF is not considered taxable income.

Recommended: A Look Into the Public Service Loan Forgiveness Program

Whose Student Loan Cancellation Is Federally Taxed?

Borrowers who receive loan cancellation after participating fully in an income-driven loan repayment plan can generally expect to pay taxes. Again, those whose debt was discharged in 2021 and 2022, or will be discharged in 2023, 2024, or 2025, will not need to pay federal taxes on their forgiven loans.

Forgiven amounts that are taxable are treated as earned income during the fiscal year it was received. Your lender might issue tax Form 1099-C to denote your debt cancellation.


💡 Quick Tip: Enjoy no hidden fees and special member benefits when you refinance student loans with SoFi.

Which States Have Said They Will Tax Forgiven Student Loans?

Typically, states follow the tax policy of the federal government. But some states have announced that their residents must include their forgiven or canceled student loan amount on their state tax returns.

As of October 2023, the states that say forgiven loans are taxable are Mississippi, North Carolina, Indiana, Wisconsin, and possibly Arkansas, depending on an upcoming vote in its legislature. More states could decide to do so.

It’s important to consult a qualified tax accountant or someone knowledgeable about forgiveness of student loans in your state to confirm the latest information of how much you owe.

Preparing to Pay Discharged Student Loan Taxes

If you’re anticipating a tax liability after receiving loan forgiveness, there are a few steps you can take today to get ready.

Step 1: Estimate Your Bill

The first step when bracing for a student loan forgiveness tax bill is calculating how much you might owe come tax season. This factor can be influenced by factors including the type of forgiveness you are receiving and the forgiven amount.

To avoid sticker shock, you can use a student loan forgiveness tax calculator, like the Loan Simulator on StudentAid.gov. It lets you see how much of your student loan debt might be forgiven, based on your projected earnings.

Step 2: Choose the Right Plan

Enrolling your federal student loans into an IDR plan can help you keep your monthly payments to a manageable amount while you’re awaiting loan forgiveness. All of these repayment plans calculate your monthly payment based on your income and family size.

The newest IDR program is the Saving on a Valuable Education (SAVE) plan, which offers unique benefits that will lower payments for many borrowers, to as low as 5% of disposable income in 2024 for those who qualify.

Recommended: The SAVE Plan: What Student Loan Borrowers Need to Know

Step 3: Prioritize Saving

If you’re expecting loan forgiveness after 2025, it might be advantageous to allocate extra cash flow toward a dedicated tax savings fund. Incrementally setting money aside over multiple years can ease the burden of a sudden lump sum tax bill down the line.

Paying Taxes on Canceled Student Loan

If you can’t afford to cover an increased tax bill, contact the IRS to discuss your options. Inquire about payment plans that can help you pay smaller tax payments over a longer period of time. However, be aware that fees and interest will likely accrue.


💡 Quick Tip: Refinancing could be a great choice for working graduates who have higher-interest graduate PLUS loans, Direct Unsubsidized Loans, and/or private loans.

The Takeaway

Thanks to a special law passed by Congress in 2021, post-secondary education loans forgiven from 2021 through 2025 will not count as earned income and will not be federally taxed. That said, state taxes may be due, depending on where the borrower lives.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

FAQ

Is loan repayment considered taxable income?

If your employer offers loan repayment assistance benefits, they would typically be considered taxable income. However under the Cares Act, loan forgiveness payments — and employer assistance loan payments up to $5,250 — made each year from 2021 through 2025 are tax-free.

Will refinancing my student loans help me avoid taxes?

Student loan refinancing simply involves reworking one or more existing student loans into a new private loan with more favorable terms. It’s a repayment strategy that does not incur a tax liability.

Photo credit: iStock/fizkes

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

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