Student Loans Archives

Aug

2025

Gift Aid vs Self Help Aid For College

By Julia Califano | Going to College, Student Loans, student_loan | Comments Off

Table of Contents

What Is Gift Aid?
Pros and Cons of Gift Aid
What Is Self-Help Aid?
Pros and Cons of Self-Help Aid
Qualifying for Gift Aid and Self-Help Aid
The Takeaway
FAQ

Over the past few decades, the cost of earning a college degree has soared. For the 2024-25 academic year, the average cost of attendance was roughly $30,000 at in-state public universities, $49,000 for public universities out of state, and $63,000 at private colleges, according to the College Board.

Those figures can feel overwhelming to many families. Fortunately, financial aid can make higher education far more affordable. Generally speaking, there are two main types: gift aid and self-help aid.

Gift aid is financial assistance that typically does not have to be paid back. This includes grants and scholarships, which may be awarded based on financial need or merit. Self-help aid, on the other hand, includes work-study opportunities and loans. It’s referred to as self-help because the student is responsible for taking action, either by working for wages or repaying borrowed funds.

Understanding the differences between these two types of aid can help you make smarter financial decisions for your education. Here, we’ll walk you through how each type of financial aid works, their pros and cons, and how to qualify.

Key Points

• Financial aid for college students is divided into gift aid and self-help aid.

• Gift aid, like scholarships and grants, does not require repayment and helps reduce long-term debt.

• Gift aid is competitive, may not cover all expenses, and could impact eligibility for other aid.

• Self-help aid includes work-study programs and loans, providing flexible work and borrowing options.

• Self-help aid may offer limited earnings, and interest on loans adds to college costs.

What Is Gift Aid?

Gift aid refers to financial assistance awarded to students that generally does not require repayment. Gift aid can come from various sources — federal or state governments, colleges, private organizations, nonprofit foundations, and even employers.

Here’s a look at the two main types of gift aid:

Grants

Government agencies, private organizations, and colleges award grants to both undergraduate and graduate students, typically based on financial need. Award amounts, eligibility requirements, and application processes vary depending on the grant.

The largest federal grant program available to undergraduate students is the Pell Grant. For the 2025–26 award year, the maximum Federal Pell Grant is $7,395. Other federal grants include the TEACH Grant (for students who want to pursue a teaching career) and Federal Supplemental Educational Opportunity Grant (for undergraduate students with exceptional financial need).

There are also state-specific grants and institutional grants. You generally apply for grants by filling out the Free Application for Federal Student Aid (FAFSA®).

💡 Quick Tip: SoFi offers low fixed- or variable-interest rates. So you can get a private student loan that fits your budget.

Scholarships

There are thousands of scholarships available to help students pay for college. They are offered by schools, employers, individuals, private companies, nonprofits, communities, religious groups, and professional and social organizations.

Scholarships are often awarded based on merit, such as academic achievement, athletic ability, artistic talent, leadership qualities, or a specific field of study. Some scholarships are based on financial need. There are also scholarships that are geared toward particular groups, such as scholarships for women or students who come from military families.

You can find out about scholarships through your high school guidance counselor and the financial aid office at the school you plan to attend, as well as by using an online scholarship database. “Start researching scholarships early, because gathering the required documents and information to apply takes time, and early deadlines are common for large awards,” advises Brian Walsh, CFP® and Head of Advice & Planning at SoFi.

Pros and Cons of Gift Aid

There are both benefits and drawbacks to gift aid. Here are some to keep in mind:

Pros of Gift Aid

• No repayment required: You typically don’t have to pay the money back, making it the most financially beneficial type of aid.

• Reduces long-term debt: Every dollar of gift aid is one less dollar you might need to borrow.

• Can cover a variety of costs: Depending on the award, funds may be used for tuition, fees, housing, books, and other education-related expenses.

• Can be renewable: Many grants and scholarships can be renewed annually if you continue to meet the requirements.

Cons of Gift Aid

• Competitive and limited: Scholarships often have strict eligibility requirements and can be highly competitive.

• May not cover all expenses: Gift aid often doesn’t fully cover the total cost of attendance.

• Performance requirements: Some awards require you to maintain a certain GPA, be enrolled full-time, or meet other ongoing conditions.

• Possible impact on other aid: Receiving large amounts of gift aid can sometimes reduce eligibility for need-based aid.

What Is Self-Help Aid?

Self-help aid includes resources that require either repayment or active participation by the student. Here’s a look at the two main types of self-help aid.

Work-Study Program

The Federal Work-Study Program provides part-time jobs for undergraduate and graduate students with financial need, helping them to earn money they can put towards education expenses. These jobs are often located on campus, but they can also be with off-campus nonprofit organizations or public agencies. Work hours also tend to be flexible to accommodate class schedules.

When you get a work-study job, you’ll earn at least the current federal minimum wage. These earnings will be paid directly to you (unless you request otherwise) and can be used for any expenses, not just tuition.

Students apply for work-study through the FAFSA, which determines eligibility based on financial need. If you’re eligible, work-study will likely be included in your financial aid package.

While work-study can be a great way to earn money and gain work experience, it’s important to note that your earnings will depend on how many hours you can work, and the total award is capped at a certain amount per year.

Federal and Private Student Loans

Student loans are borrowed funds that must be repaid with interest. There are two main types of student loans: federal and private.

Federal student loans are offered by the U.S. Department of Education. These loans generally have lower interest rates and more flexible repayment options. You do not have to start repaying federal student loans until after you graduate, leave school, or change your enrollment status to less than half time.

The main types of federal student loans include:

• Direct Subsidized Loans: Offered based on financial need, the government pays the interest on these loans while you’re in school at least half-time. There are annual (and total) limits on how much you can borrow.

• Direct Unsubsidized Loans: These loans are not offered based on financial need, but interest will begin accruing from the moment the loan is disbursed. As with Direct Subsidized Loans, there are annual (and total) limits on how much you can borrow.

• Direct PLUS Loans: These loans are available to parents of dependent undergraduates and graduate/professional students. Eligibility is based on a credit check, and you can currently borrow up to the full cost of attendance, minus other aid. (Note: Grad PLUS loans are being eliminated as of July 1, 2026.)

Private student loans are provided by banks, credit unions, and other private lenders. A credit check is required, so students typically need a cosigner unless they already have a strong credit history. Private student loans often have higher interest rates and fewer borrower protections than federal student loans. However, they come with higher borrowing limits, which can make them useful for bridging funding gaps if federal aid is insufficient.

💡 Quick Tip: Parents and sponsors with strong credit and income may find much lower rates on no-fee private parent student loans than federal parent PLUS loans. Federal PLUS loans also come with an origination fee.

Pros and Cons of Self-Help Aid

Here’s a look at the advantages and disadvantages of self-help aid:

Pros of Self-Help Aid

• Accessible to many students: Student loans and work-study programs are widely available.

• Builds responsibility: Managing work and loan repayment can help students develop time management and budgeting skills.

• Flexible repayment for federal loans: Federal loans offer options like income-driven repayment, deferment, and loan forgiveness for qualifying borrowers.

• Work experience: Work-study jobs can build your résumé and help with networking.

Cons of Self-Help Aid

• Repayment obligation: Loans must be repaid with interest, which can significantly increase the total amount you owe.

• Potential for debt burden: Borrowing too much can lead to long-term financial strain after graduation.

• Limited earnings with work-study: Work-study wages are often modest and unlikely to cover major expenses.

• Time commitment: Balancing work hours with academic responsibilities can be challenging.

Qualifying for Gift Aid and Self-Help Aid

Both gift aid and self-help aid are typically awarded through the college’s financial aid process, and most programs require you to submit the FAFSA each year.

Eligibility for gift aid is often based on:

• Financial need: Many grants, such as the Pell Grant, are need-based.

• Academic achievement: Scholarships may require a certain GPA, standardized test score, or other achievements.

• Special criteria: Some awards are based on factors like major, athletic ability, community service, or demographic background.

How to qualify for self-help aid depends on the type of aid.

• Work-Study: This is awarded based on financial need as determined by your FAFSA, but also depends on available funding at your school.

• Federal loans: Students who complete the FAFSA typically qualify for some type of federal student loan, regardless of credit history or income.

• Private loans: These loans require a credit check, and students without established credit may need a cosigner.

It’s important to meet all deadlines and supply accurate information to maximize your eligibility for any aid.

The Takeaway

When it comes to paying for college, both gift aid and self-help aid can play important roles. Gift aid — grants and scholarships — reduces the cost of college without adding debt, making it the ideal first choice. However, because gift aid alone often doesn’t cover the full cost of attendance, self-help aid like work-study and student loans can help bridge the gap.

A smart approach is to prioritize free money first, then use self-help aid to fill in any remaining needs. Borrow only what you truly need, and be mindful of repayment terms. By understanding your aid options and planning ahead, you can make college more affordable without sacrificing your financial future.

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.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

What is the difference between gift aid and self-help aid?

Gift aid is financial assistance for college that doesn’t need to be repaid, such as grants and scholarships. It’s often awarded based on financial need, academic merit, or special criteria. Self-help aid, on the other hand, requires the student to take action, either by repaying borrowed money (student loans) or working for wages (work-study programs). While gift aid directly reduces costs, self-help aid helps students manage expenses through debt or employment, so it typically requires more responsibility after receiving it.

Do parents who make $120,000 still qualify for FAFSA?

Yes, FAFSA isn’t itself an income-based approval system. It’s simply the application for federal student aid. While high-income households may not qualify for need-based federal grants like the Pell Grant, they can still access unsubsidized federal loans, work-study (in some cases), and merit-based scholarships awarded by colleges that use FAFSA information in their aid decisions.

What is self-help aid for college?

Self-help aid is financial assistance that requires the student to take an active role in covering education costs, either through repayment or work. The two main forms are student loans, which must be repaid with interest, and work-study programs, where students earn money by working party-time jobs, often on campus. Unlike gift aid, which is essentially free money, self-help aid doesn’t reduce tuition costs. Instead, it provides a way for students to manage their expenses.

What are two types of gift aid?

The two main types of gift aid are scholarships and grants. Scholarships are often awarded based on merit, such as academic achievement, athletic skill, leadership, or artistic talent, though some also consider financial need. Grants are typically need-based and come from the federal government, state programs, or institutions. Both scholarships and grants typically do not require repayments, making them highly desirable forms of aid.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

SoFi Bank, N.A. and its lending products are not endorsed by or directly affiliated with any college or university unless otherwise disclosed.

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 Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

SOISL-Q325-147

Aug

2025

How to Handle Law School Debt

By Maureen Shelly | Debt Payoff, Student Loans, student_loan | No Comments

Table of Contents

Law School Loan Refinance
Consolidating Law School Loans
What Are Some Solutions for Handling Law School Debt?
Long-Term Strategies for Managing Law School Debt
The Takeaway
FAQ

If you’re a law school graduate, you likely have student loan debt — 71% of law school grads do, with an average law school debt of $130,000, according to the Education Data Initiative. Whether you’re concerned about being able to manage your monthly payments or you’d like to save money on interest, now is a good time to consider a new repayment plan.

Here, we’ll focus on how to pay off law school debt using two popular methods— refinancing and consolidating — and the pros and cons of each. Keep reading to learn which one may be right for your situation.

Key Points

• Making interest-only payments on student loans during law school can help manage debt.

• After graduation, borrowers can select a repayment plan that aligns with their budget and goals.

• Refinancing may lower interest rates for some borrowers but forfeits federal protections.

• Consolidation simplifies federal student loan payments and can extend loan forgiveness eligibility.

• Student loan forgiveness and employer loan repayment assistance may be options for some law school graduates.

Law School Loan Refinance

Often, one of the main goals of refinancing law school loans is to reduce the amount of interest paid over the life of the loan. To do this, borrowers ideally qualify for a lower interest rate, which saves them money.

Another way a borrower can reduce interest is to shorten their loan term — the payment period of their refinance loan. However, that means their monthly payments could be considerably higher. In this instance, student loan refinancing for law school loans may work best for people earning a high salary and who have a good sense of job security.

One drawback to refinancing federal student loans is losing access to certain federal protections, such as loan forgiveness programs, income-driven repayment plans, and deferment options. That’s because when you refinance, you’re paying off one or more federal loans with a new, private loan.

Considering refinancing your law school loans? Before moving forward, make sure you won’t need those federal protections.

How to Refinance

As you explore the option of refinancing to see if it makes sense for you, it’s helpful to know what’s involved. The process of refinancing is pretty straightforward.

1. Check Your Credit History

Refinancing lenders set interest rates based on an applicant’s credit score. Requirements vary, but many lenders like to see a credit score of 670 or higher, which Equifax, one of the credit reporting agencies, considers “good.” Keep in mind the higher the score, the more likely a borrower is to get a better offer or interest rate. If your credit score is below 670, you may choose to take some time to build your credit before refinancing.

You can request your credit report for free from AnnualCreditReport.com. And you can find out your credit score for free from Experian, and also through some banks and lenders.

2. Explore Income-Driven Repayment Options

If your goal is to have more affordable payments, an income-driven repayment (IDR) plan may be a better option. These plans are designed to make student loan payments more manageable by basing monthly payments on the borrower’s discretionary income and family size. There are currently three IDR plans open to borrowers: Income-Based Repayment (IBR), Income-Contingent Repayment (ICR), and Pay As You Earn (PAYE).

While most of the current income-driven repayment plans will close in the coming years, IBR will remain open and available to current borrowers. With IBR, you’ll pay 10% of your discretionary income each month on a 20-year term if you first borrowed a loan after July 1, 2014. IBR forgives your remaining balance if you still owe money at the end of the term.

As for the two other IDR plans, PAYE sets your monthly payments at 10% of your discretionary income and extends your loan terms to 20 years. ICR sets your payments to 20% of your discretionary income and has a repayment term of 25 years. As noted, both of these plans are currently available to borrowers, but they are set to close and will not be accepting new enrollments on or after July 1, 2027. If you’re currently on PAYE or ICR, you have the option of switching to IBR.

For borrowers taking out their first law school loans on or after July 1, 2026, there will be only one repayment option that is similar to the current IDR plans: the Repayment Assistance Program (RAP). On RAP, payments range from 1% to 10% of a borrower’s adjusted gross income for up to 30 years. At that point, any remaining debt will be forgiven. If a borrower’s monthly payment doesn’t cover the interest owed, the government will cover the interest.

3. Run the Numbers in a Student Loan Refinancing Calculator

An online student loan refinancing calculator can help you determine what interest rate you’ll need to qualify for in order to make refinancing worth your while. It can also show you different loan term options. Generally, the longer the repayment timeline, the lower your monthly payments, but the more you’ll pay in interest over time. Shorter timelines mean higher payments and less interest paid.

4. Compare lenders

Go online to research the top lenders that offer student loan refinancing. Select a handful with strong reputations that also offer your target interest rate.

5. Prequalify to See Terms

Get prequalified to see what the loan terms are. (This requires only a soft credit check, which doesn’t affect your credit score.) When comparing terms, don’t only consider the lowest interest rate. Also look for any added benefits (such as unemployment protection), cash-back bonuses, and customer service ratings.

6. Select a Lender and Apply

Once you’ve settled on a lender, gather the documents you’ll need to make a formal application, such as W2 forms or pay stubs to verify your income.

Pros and Cons of Refinancing

Carefully review the pros and cons of refinancing student loans before you make a decision.

Pros of Refinancing	Cons of Refinancing
The potential opportunity to get a lower interest rate and more favorable loan terms	Giving up federal protections, including loan forgiveness, when refinancing federal loans
Save money on interest — possibly thousands of dollars over time	May not be worth it if your new interest rate isn’t significantly lower than your current rate
May be able to pay off loans faster	May not substantially lower your monthly payment

Consolidating Law School Loans

Debt consolidation involves taking multiple loans and combining them under one new loan with just one monthly payment. The main goal is to simplify your finances.

Borrowers who took out federal student loans as one of the ways to pay for law school may use a federal program called a Direct Loan Consolidation. Your new loan’s interest rate will be the weighted average of all the old student loans’ interest rates, rounded up to the nearest eighth of a percent. This means your interest rate might actually be slightly higher than the rate you were paying before consolidation on some of your student loans.

When you consolidate, you’ll also have the option to select a new repayment plan. Consolidation can also be a first step toward loan forgiveness, including law school loan forgiveness.

Private student loans cannot be consolidated using the federal consolidation program.

How to Consolidate

The Direct Loan Consolidation application process is available through the office of Federal Student Aid. Simply fill out the online application, or you can print out a paper version and mail it. It may help to first gather all of your loan records, accounts, and payment history as you work through the form. The process takes about 30 minutes total.

If you have a loan that will be paid off in a short amount of time, you might consider leaving it out of the consolidation. The same goes if you have already made qualifying payments toward forgiveness on certain loans.

Your first new payment will be due within two months of when your Direct Consolidation Loan is first paid out.

Pros and Cons of Consolidating

Just like refinancing, there are advantages and disadvantages of student loan consolidation.

Pros of Consolidating	Cons of Consolidating
Could lower your monthly paymen	Pay more in interest over the life of the loan/td>
Simplifies repayment	Extends your repayment period
Eligibility for federal protections, including Public Service Loan Forgiveness (PSLF)	Can cause you to lose credit for payments toward loan forgiveness
Doesn’t affect your credit score	Private loans and Parent PLUS loans cannot be consolidated with federal loans in the student’s name
Allows you to switch from a variable interest rate to fixed

What Are Some Solutions for Handling Law School Debt?

If you’re passionate about having a career in law, don’t let the cost of your education deter you from pursuing a rewarding profession.

Managing law school debt might seem overwhelming, but having a strategy can help you pay off your debt.

Here are several solutions to consider:

Making Interest-Only Payments While in School

Under the federal student loan deferment program, you aren’t required to make any payments while you’re in school. However, paying at least the amount of interest that is accruing on your loans each month could help keep your student debt from snowballing. And if you are able to pay more than just the interest, it’s a smart idea. The faster you pay down your loans, the less they’ll generally cost you over time.

Picking a Repayment Plan That Fits Your Budget

Once you graduate and start working, you’ll likely have a few financial priorities competing with your student loan repayment. In general, it can be a smart strategy to pay down law school debt as soon as you have a steady income. But paying down your loans too aggressively could leave you without enough savings. Building up an emergency fund can provide you with a buffer in case you have unforeseen expenses.

It can also make sense to start putting a percentage of your income toward a retirement fund to take advantage of potential long-term gains. You may want to factor your savings goals into your budget and pick a student loan repayment plan that fits your cash flow.

Putting any Extra Funds Toward Your Debt

Alternately, you can make paying down debt your top priority and put any extra income you have toward your highest-interest loans. Of course, if you choose this route, you may want to make sure you have a financial safety net in place first. This law school debt repayment strategy is typically called the avalanche method.

Essentially, with the avalanche method, you make additional payments on your highest-interest loans first while making regularly scheduled payments on all your loans. This helps reduce the amount of total interest you’re paying. And by paying your loans down early, you could save on interest payments over the years because the faster you pay off your student loans, the faster you can stop paying interest on your debt.

Cutting Back

You could also try to cut back on your monthly expenses and put that extra money toward your debt payments. While sticking to a budget can be challenging, it is one tool to help you stay on track with your spending.

Can you cut back on certain expenses each month? You may have to make a few sacrifices within reason. See what simple changes you can make to your budget — such as eliminating your gym membership and working out at home instead, or bringing lunch to work rather than buying it — to find extra money to put toward your law school debt. Paying more than the minimum monthly payment on your student loans can go a long way toward getting out of debt faster and saving on interest.

Making Your Loan Payments Cost Less

If you find yourself looking for a way to make your federal loan payments more manageable, an income-driven repayment plan (taking note of all the changes coming to these plans outlined above) can also lower your monthly payments by capping the amount you pay based on your discretionary income and household size.

With these plans, you may pay more interest over the life of your loans. But if your monthly payments are too high, an income-driven plan can bring them down.

Another option that can potentially reduce the cost of monthly payments is to refinance your student loans with a private lender. When you refinance, a private lender gives you one new loan to pay off your existing student loans (including your law school debt and the undergraduate debt you may still have). Your new loan will have new terms and a new (hopefully lower) interest rate.

When you opt for law and MBA refinancing, instead of paying on multiple student loans, you’ll only have to worry about paying off one loan. If you qualify for a lower interest rate and/or shorten your loan repayment term, you may pay less in interest over the life of the loan.

Just remember: Refinancing federal student loans with a private lender means you’ll no longer be able to take advantage of the benefits that come with federal loans, like forgiveness, deferment, and forbearance.

Employer Student Loan Repayment Assistance

With more borrowers struggling with student loan debt, more and more employers, including some law firms, offer student loan repayment assistance as a job perk.

For example, an employer offering this benefit may make monthly payments to your student loan servicer or lender on your behalf. There may be eligibility requirements for employees, including a certain length of service. Program specifics vary from employer to employer.

If you are in a public interest legal job, many civil legal aid organizations and other public interest employers offer loan repayment assistance to their employees.

Check with your employer to find out if they offer a loan repayment benefit program.

Long-Term Strategies for Managing Law School Debt

In addition to the options mentioned above for managing your debt, there are also some steps you can take to help reduce what you owe on your law school loans over the long term.

Pursuing Public Service Loan Forgiveness (PSLF)

If you’re a lawyer employed by a government or nonprofit organization, you may be eligible for the Public Student Loan Forgiveness (PSLF) program. PSLF forgives the remaining balance on your federal Direct Loans after you’ve made the equivalent of 120 qualifying monthly payments under a qualifying repayment plan, while working full-time for an eligible employer.

Private student loans are not eligible for the PSLF program.

Leveraging Tax Deductions and Credits

There are tax deductions you may be eligible for that can help you with your student loan debt. For example, the student loan interest deduction allows borrowers to deduct the lesser of $2,500 or the amount of interest they paid on federal or private student loans for the year.

Eligibility requirements to claim the student loan interest tax deduction include: A borrower must be legally required to pay interest, they cannot be claimed as a dependent on someone else’s return, they must not be married and filing separately, and their modified adjusted gross income (MAGI) must be below the annual limit, which for 2025 is $100,000 for single filers and $200,000 for those who are married and filing jointly.

The Takeaway

Two popular ways of paying off law school debt are refinancing and consolidating. With refinancing, borrowers may qualify for a lower interest rate to save money and also pay off their loans faster if they choose a shorter loan term.

Direct Loan Consolidation is a federal program that helps borrowers simplify their finances by combining multiple federal loans into one — without losing federal protections. Those struggling with law school debt can explore both options to see which one is the best fit.

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.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

FAQ

What is the average law school debt upon graduation?

Law school borrowers graduate with an average law school debt of approximately $130,000, according to the Education Data Initiative. Seventy-one percent of law school students graduate with debt.

Can law school debt be discharged in bankruptcy?

Yes, law school debt (like any student debt) can be discharged in bankruptcy. While updated guidance from the Department of Education and the Justice Department has made it easier to discharge student loans in bankruptcy in recent years, the process is still quite challenging and complex. Bankruptcy can also have serious negative impacts to your credit and is often considered a last resort. If you are considering bankruptcy, it’s wise to consult an experienced bankruptcy attorney to make sure it is the right course of action for your situation.

Are there any forgiveness programs for law school debt?

Forgiveness programs for borrowers with law school debt include the Public Service Loan Forgiveness program for those who work in public interest jobs for a government agency or nonprofit. After 120 qualifying payments while working for an eligible employer, the remaining balance on your loans may be forgiven.

Those with law school debt may also be eligible for forgiveness through the Income-Based Repayment plan, which bases your monthly payments on your discretionary income and family size and forgives the remaining balance on your loans after 20 or more years of qualifying payments.

How does income affect loan repayment options for law graduates?

A borrower’s income can affect their eligibility for certain federal loan repayment options. For example, income-driven repayment plans base your payments on an individual’s discretionary income (along with family size). Public Service Loan Forgiveness is for those who work in public interest jobs for the government or nonprofits, which may pay less than jobs in the private sector.

Law graduates with higher incomes — and who don’t need federal benefits such as income-driven repayment and deferment — may want to consider student loan refinancing to potentially get a lower interest rate or pay off their loans in a shorter amount of time.

Is it better to refinance or consolidate law school loans?

Whether it’s better to refinance or consolidate law school loans depends on your specific goals and financial situation. Generally speaking, if you’d like to maintain access to federal benefits such as forgiveness and income-driven repayment, and also simplify your payments, consolidation may be an option for you. If you have a higher income and a strong credit score, and you don’t need federal benefits, refinancing might help you secure a lower interest rate, more favorable loan terms, and pay off your loans faster. You can evaluate both options to determine which is better for you.

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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.
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.

SOSLR-Q325-021

Aug

2025

What Percentage of Your Income Should Go to Student Loans?

By Kayla McCormack | Budgeting & Goals, Fresh Out of School, Student Loans, student_loan | No Comments

Table of Contents

Calculate How Much Your Loan Costs Each Month
Determining Your Student Loan Payment as a Percentage of Income
Consider the 50/30/20 Rule and Tweak it for Debt
Income-Driven Repayment

After four (or more) years of classes, college students graduate into a new reality of employment and student loan payments. Navigating repayment may require planning and budgeting, but it’s possible to find a repayment plan that works for your personal needs.

As a general rule of thumb, the Consumer Financial Protection Bureau (CFPB) recommends limiting the total borrowed to no more than your expected starting annual salary when you leave school. But when young students are selecting colleges and evaluating costs, it can be tough to understand or predict how much they’ll earn after graduating.

Read on to learn about some potential strategies for student loan repayment to help borrowers determine what percentage of income should go to student loans.

Key Points

• College graduates should aim to limit their total student loan debt to no more than their expected starting annual salary to manage repayment effectively.

• Calculating monthly loan payments as a percentage of income can help borrowers assess their financial situation and adjust budgets accordingly.

• The 50/30/20 budgeting rule can be adapted to prioritize debt repayment by reallocating funds from discretionary spending to loan payments.

• An income-driven repayment plan with flexible payment options linked to income may be an option for borrowers struggling with standard repayment plans.

• Exploring additional income sources or refinancing options can provide borrowers with strategies to accelerate student loan repayment and reduce overall interest costs.

Calculate How Much Your Loans Cost Each Month

You’ll want to understand how much your loans cost each month. If you only have one student loan, this may be easy — the total would be your monthly loan payment. If you have multiple loans with different lenders, you may have to do a bit more math to sum up the total amount you are spending on your loan payments monthly.

After calculating your monthly loan payments, if you find you are spending a much higher percentage of your income on debt payments than you have outlined, you may want to adjust your budget, or see if you can adjust how much you are paying each month to your student loans.

You can use a student loan calculator to estimate how different loan terms and interest rates may impact your total repayment. Keep in mind that lengthening the loan term on your student loans may result in lower monthly payments, but may cost more in interest over the life of the loan.

💡 Quick Tip: Get flexible terms and competitive rates when you refinance your student loan with SoFi.

Determining Your Student Loan Payment as a Percentage of Income

When it comes to repaying your student loans, your first goal might be to make, at the very least, the minimum monthly payment on each of your student loans. Failing to do so means your loan could become delinquent, and after 90 days of delinquency, your loan servicer can report the late or missed payments to the credit bureaus and your credit score may be affected.

If you don’t know what your monthly payments are, you can use our student loan calculator (see link above) to get an estimate. It can give you a good idea of what you’ll pay each month. To calculate the percentage of your income, divide your total monthly loan payment by your income. For example, if your monthly loan payment was $400 and your monthly income was $5,000, your loan payment would be 8% of your monthly income.

Consider the 50/30/20 Rule and Tweak it for Debt

The 50/30/20 budgeting rule outlines spending in the following categories:

• 50% of your income is budgeted for needs

• 30% of your income goes to “wants” and discretionary expenses

• 20% of your income is allocated for savings and paying off debt like student loans

Using this general framework may help borrowers create a budget that makes sense for their lifestyle and needs, without being overly prescriptive. If you have a lot of student loan debt that you are focusing on repaying, you can adjust the percentage allocation so that you are funneling more money toward your debt.

Because on-time payments account for 35% of your FICO® score, setting up a budget that helps you make one-time student loan and other debt payments each month is one of the best tips for building credit.

Income-Driven Repayment

If you have federal student loans and are struggling to make payments on the standard 10-year repayment plan, one alternative you could consider is income-driven repayment (IDR). On an income-driven repayment plan, your monthly payments are determined as a percentage of your income.

There are currently three options for income-driven repayment. Depending on the plan you enroll in, the repayment term is extended to 20 to 25 years, and payments are capped at 10% to 20% of your income. More precisely, the payment amount is calculated as a percentage of your discretionary income.

While income-driven repayment plans might help make monthly payments more manageable, extending the length of the loan means you could end up paying more interest than you would on the standard repayment plan.

The good news is that if you still have a balance at the end of the repayment term on the Income-Based Repayment (IBR) plan, your remaining debt could be discharged (although it may be taxed). The other plans (PAYE and ICR) no longer lead to loan forgiveness, but you could get credit for your payments by switching to IBR.

Note that PAYE and ICR will close soon due to legislative changes, and a new option will be introduced called the Repayment Assistance Plan (RAP). You have until July 1, 2027 to apply for PAYE or ICR, but you’ll have to switch to IBR or RAP once those plans shut down.

Making Extra Payments Based on Your Monthly Income

If you would like to accelerate your student loan repayment, consider paying an additional percentage of your disposable income toward student loans. For example, if you are using a 50/30/20 budget, but want to make additional overpayments, you may instead choose to do a 50/25/25 budget, where you reduce your discretionary spending by 5% each month and apply those funds as an additional student loan payment instead.

Only you can determine where you want to focus your financial energy. An online student loan payoff calculator could help determine how much your overpayment could accelerate your loan payoff and save you in interest.

Recommended: Tips to Lower Your Student Loan Payments

Additional Options for Accelerating Your Student Loan Repayment

If your budget is already lean and you don’t have the room to contribute extra income toward student loans every month, there are alternatives that could help you speed up your repayment plan.

Part-Time Job or Side Hustle

One idea is to pick up a part-time job or find a side hustle that allows you to bring in a little bit of extra cash. Then you could focus all of your side hustle income toward student loan repayment. It’s money you didn’t have before, so your budget won’t have to make any sacrifices.

Another option is to focus any unexpected or windfall money toward student loan repayment. When you receive a bonus at work or a birthday check from your aunt, you could contribute that money to your student loans instead of spending it on a splurge expense for yourself.

Student Loan Refinancing

Finally, you can also improve your existing federal or private student loan situation. Student loan refinancing could help you secure a lower interest rate, which could mean spending less money over the life of the loan.

As part of the refinancing process, you’ll be able to select a new repayment term. Shortening the repayment term could also mean you pay less in interest over the life of the loan. You also have the option to lengthen the loan term. If you do, you’ll spend more money in interest over that longer term, though it could mean a lower monthly payment if you need to free up some cash.

When you apply to refinance a student loan, lenders will review your credit history and employment history, among other factors. Refinancing student loans with bad credit, while possible, may be more challenging. Those with a low credit score or limited credit history may want to consider establishing credit before they apply for refinancing.

Another option for borrowers with a less-than-stellar credit score may be adding a cosigner to strengthen the application. A cosigner agrees to repay the loan if the primary borrower fails to do so. Refinancing without a cosigner may make sense for borrowers who have had time to establish credit.

It is important to note that if you refinance your federal loans with a private lender, you will lose access to federal benefits such as federal loan forgiveness and deferment.

To find out how student loan refinancing could impact your student loan repayment prospects, use SoFi’s student loan refinance calculator.

The Takeaway

There is no single answer for what percentage of your income should be allocated to paying off student loan debt. It’s important to make your monthly minimum payments to avoid delinquency or default. Beyond that, you may consider making overpayments to accelerate your student loan payoff.

When you refinance with SoFi, there are no origination fees or prepayment penalties and you’ll gain access to community events. You can start the application online and find out what interest rate you prequalify for in just minutes.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

FAQ

What percentage of income is too much for student loans?

The percentage of income that’s too much for student loans depends on your specific financial situation and goals. However, one common rule of thumb is that student loan payments shouldn’t be more than 10% of your income.

Can you pay more than your required monthly student loan payment?

Yes, you can pay more than your required monthly student loan payment. Student loans generally have no prepayment penalties. And by putting extra money toward your loan, you may pay it off faster. Ask your loan servicer to apply the additional funds to the principal of your loan, which could help reduce the amount of interest you pay over the life of the loan.

How do income-driven repayment plans determine your monthly payment?

Current income-driven repayment plans base your monthly payments on your discretionary income and family size. Depending on the plan you enroll in, monthly payments are capped at 10% to 20% of your income for 20 to 25 years.

However, as of July 1, 2026, there will be just one income-driven plan: the Repayment Assistance Program (RAP). On RAP, payments will range from 1% to 10% of your adjusted gross income for up to 30 years.

Should I pay off student loans faster or save more for retirement?

There is no one-size-fits-all answer to this question. Whether you should pay off student loans faster or save more for retirement depends on your unique financial situation and goals. Consider what is more important to you — reducing debt or putting money toward the future. For instance, if you have high-interest debt such as credit card debt, you may want to focus on repaying that first since it can be costly, and then work on saving for retirement and/or paying off your student loans faster.

How does refinancing affect my student loan payment percentage?

Student loan refinancing gives borrowers a new interest rate and loan terms. If you qualify for a lower interest rate, your monthly payments could be reduced, with less going toward interest, thus making your monthly payments a smaller percentage of your income.

You could also choose to shorten your loan term, which could increase your monthly payments but allow you to pay off your loan faster. You can explore the different refinancing scenarios and see what you might qualify for. But be sure to keep in mind that refinancing federal student loans makes them ineligible for federal benefits.

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 .

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.

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.
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.

SOSLR-Q325-036

Aug

2025

Tips for Taking Online Classes Successfully

By Julia Califano | Going to College, Student Loans, student_loan | Comments Off

Online college classes give you the flexibility to study from anywhere — your bedroom, home office, or even a coffee shop. Having the option to take some (or all) of your classes online can also make it easier to balance school with other commitments, such as a full-time job or family responsibilities.

However, online learning also comes with some challenges. It can be difficult to focus if you’re not in an actual classroom. Plus, virtual learning can make it harder to make connections with professors and other students at the school.

Read on for a closer look at how online classes work, their pros and cons, and how to make the most of virtual learning.

Key Points

• Online classes offer flexibility and cost savings, making them ideal for students balancing work, family, or other responsibilities — especially with asynchronous formats and reduced commuting or living costs.

• Virtual courses come in two formats: hybrid (a mix of online and in-person) and fully online, allowing students to choose the best structure for their learning style and schedule.

• Common challenges include reduced social interaction, weaker networking opportunities, and time management issues, which can affect motivation and academic performance.

• Success strategies include setting up a distraction-free workspace, actively participating in class forums, and staying on top of deadlines with strong time management.

• Tuition for online classes can be funded through federal loans, private loans, payment plans, or paying per class, though private loans should typically be considered only after federal aid options are exhausted..

Types of Online Classes

There are two main types of online classes. Here’s a closer look at each.

Hybrid Approach

A hybrid course is a mix of in-person instruction and remote learning. The exact schedule will vary by school, class, and instructor, but may include several hours of live or prerecorded virtual learning per week with one in-person session. For example, a chemistry course could include virtual learning and in-person lab work.

Hybrid courses offer the benefits of remote learning without fully abandoning in-person instruction, making it a prime choice for students concerned that online classes may not meet their needs.

Exclusively Virtual

Classes that are all virtual never meet in person. Instruction is given through live webinars, prerecorded video, and physical or digital material.

Depending on the format of the course, students can fit sessions into their schedule as they see fit, an option not provided by a hybrid or traditional class.

Benefits and Potential Pitfalls of Virtual Courses

While virtual learning is ideal for some students, it may be frustrating for others. Here’s a look at some of the pros and cons of taking college courses online.

Pros of Online Courses

Flexibility: The ability to learn whenever and wherever can be a huge advantage for a student with a hectic schedule. Though there are still deadlines and due dates to abide by, learning can typically take place around work, social commitments, and personal preferences. While some courses may include live remote sessions, they’re typically recorded and available for students to view at a later time.

Real-life experience: Online courses tend to put more responsibility on the student. Learning how to prioritize instruction in a flexible schedule can help prepare students for careers.

Potential savings: If a course was designed to be taught in person but has recently been adapted for online instruction, a discount may not be available. But for courses originally built for virtual learning, students often find they can save on the average credit cost. An online degree might also have a condensed schedule. allowing you to get your degree faster.

There are other savings to consider. With online instruction, students generally don’t have to worry about paying for parking, gas, or lunch on the go. Plus virtual learning can allow you to pursue an education while working full or part time, an option not always available to in-person students.

Recommended: How to Find the Right College

Potential Cons of Online Courses

Minimal social benefits: One potential downside to taking a class online is lack of personal interaction. You might find it harder to ask the teacher questions and make connections with fellow students. And, some students simply respond better to in-person vs. online learning, and might struggle to concentrate when learning virtually.

A lack of professional networking: Students often discover opportunities to build relationships with professors and assistants that can lead to careers. Virtual learning makes these relationships more difficult to find and develop.

Scheduling conflicts: While the flexibility of online classes can be appealing, it can create scheduling conflicts. If you are challenged by time management, you may find yourself procrastinating and struggling to manage your workload along with other everyday responsibilities.

Tips for Online Classes

Here are some words to the wise for taking online courses, for both newbies and experienced virtual students.

• Respect the course. Do you suspect that an online course has less value than in-person instruction? The educational value is the same. It’s just being delivered in a different fashion.

• Think about time management. Even experienced virtual students can often improve their time management skills. Review the syllabus at the start of the semester, note major assignments, and look for potential conflicts.

• Try to avoid distractions. When taking online courses, it might be best not to set up in front of the TV, as tempting as it may be. Consider cobbling together a home office that blocks distractions and creates a productive environment.

• Participate. While an online class can be an introvert’s dream, there are still opportunities to participate. Many online courses offer a forum for students and instructors to discuss course materials, comment on one another’s work, and ask questions as needed.

Funding the Virtual Voyage

Even though some online classes and degree programs can be more affordable than their in-person counterparts, tuition costs may still come with sticker shock. Depending on the school and online program you’re looking to enroll in, however, you may have the following options to help fund your college education.

Paying à la Carte

Online courses are often designed to fit a working student’s schedule (though being employed certainly isn’t a requirement). In some cases, you may be able to pay for classes as you go. In others, the school may also offer a payment plan, allowing you to make monthly payments over time to cover the cost of your online degree.

Federal Loans

By filling out the Federal Application for Federal Student Aid (FAFSA), you will find out if you are eligible for federal student aid, including grants (which you don’t have to pay back) and loans (which you do).

With federal subsidized student loans, you won’t start accruing interest until six months after you graduate. With unsubsidized federal loans, interest begins to accrue as soon as the funds are dispersed (though you can defer making any payments until six months after you graduate). Federal student loans don’t require a credit check and come with a relatively low, fixed interest rate set by the government.

Private Loans

If there are still gaps in funding, you may also want to explore private student loans. These are available through private lenders, including banks, credit unions, and online lenders, and do require a credit check. If you don’t have much credit history or income, you will likely need a cosigner. Rates may be fixed or variable, and are set by the lender. Borrowers with excellent credit tend to qualify for the lowest rates.

A private student loan can cover up to 100% of the cost of school-certified attendance, both for in-person and online courses. Keep in mind, though, that federal student loans offer benefits, like income-based repayment plans and Public Service Loan Forgiveness, that are not guaranteed by private lenders.

The Takeaway

Online classes can have several advantages over in-person ones, saving you time and money and offering the convenience of studying whenever and wherever suits you. However, to succeed, you likely need to focus on minimizing distractions, managing your time wisely, and participating to get the most out of paying for your courses. Also look into options for paying for qualifying classes, such as federal and/or private student loans.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

How to do well in online classes?

Tactics for doing well in online classes include focusing on time management, avoiding distractions, and participating to boost engagement.

How hard is it to take online classes?

Online classes can require more focus, organization, and time management skills than in-person classes. You likely won’t have your professors talking in class about assignment due dates and upcoming tests. Also, distractions when watching classes must be minimized.

Are online classes easier than in-person ones?

It’s a myth that online classes are intrinsically easier than in-person ones. The level of difficulty can vary tremendously among both online and in-person classes. Also, online classes can demand greater focus, time management, and self-reliance to succeed.

About the author

Julia Califano

Julia Califano is an award-winning journalist who covers banking, small business, personal loans, student loans, and other money issues for SoFi. She has over 20 years of experience writing about personal finance and lifestyle topics. Read full bio.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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.

SOISL-Q325-103

Aug

2025

What to Expect at College Orientation

By Kevin Brouillard | Going to College, Student Loans, student_loan | Comments Off

College orientation is an exciting initiation into freshman year and an opportunity to learn about your classes and extracurricular activities, make friends, and get acclimated to your new surroundings.

While it may span just a few days or a week in total, college orientation is packed with information and experiences that can set you up for success over the next four years.

Planning ahead and diving into the details of the orientation schedule is just one of many ways to prepare for college. Although every school operates differently, here are some key college orientation tips and things to expect when you arrive on campus.

Table of Contents

When Does Orientation Take Place?
What Is an Orientation Schedule Like?
What Happens at Orientation?
What About Parents and Family?
Paying for College
The Takeaway
FAQ

Key Points

• Plan ahead and understand the college orientation schedule, including mandatory and optional sessions.

• Make friends and get acquainted with campus life through social activities.

• Learn the campus layout to avoid tardiness.

• Attend financial aid sessions to manage college costs effectively.

• Familiarize yourself with essential campus resources like dining halls and classrooms.

When Does Orientation Take Place?

Some college orientations happen in the middle of summer, while others take place right before the beginning of the semester. The earlier variety is typically conducted in smaller groups and may be organized separately for specific programs or majors.

Midsummer orientations often give students the opportunity to stay in the dorms ahead of moving to campus. This can be a useful test run to get acquainted with the dorm life and mingle with fellow incoming students.

What Is an Orientation Schedule Like?

Once the college orientation schedule is available, look out for which parts are mandatory, such as taking a student ID photo and registering for classes, and any optional social, extracurricular, and informational activities that sound interesting or helpful.

College orientation is a time to make friends and get acquainted with college life, but knowing where the dining hall, laundry room, student transportation, and other services are located also comes in handy.

Having a game plan for the orientation schedule will give you an opportunity to invite new acquaintances to attend an event or activity together. At the same time, allowing yourself to go with the flow a bit might alleviate some of the stress.

Compared to a strictly regulated high school schedule, college students are given much more discretion in making decisions for themselves. While this newfound freedom can be liberating, it can present challenges for balancing studying effectively with the fun, social aspects of college.

Orientation is a chance to get acclimated before the pressure of staying on top of schoolwork arises.

Recommended: 10 Ways to Prepare for College

What Happens at Orientation?

The full scope of college orientation will vary by institution. However, there will likely be a mix of instructional and social activities to round out each day. Some topics that are typically covered include:

• School rules, policies, and code of conduct

• Meetings with an academic or department advisor

• Guided tour of campus

• Skits and role-play activities

• Ice breakers with a residential advisor and dorm floormates

While some sessions may feel tedious, making a good first impression on a residential advisor, professor, and peers can be invaluable.

Learning About Extracurricular Activities and Campus Life

College orientation usually includes a range of informational and fun activities to introduce students to campus activities. Many student clubs and organizations have tables at orientation or early in the semester to meet and attract incoming students.

Depending on school size and culture, the number of offerings and niches can be vast compared to high school, including intramural sports, Greek life, theater troupes, and culture clubs.

Learning the Lay of the Land

After the guided tour, you may want to spend some time going over (and memorizing) how to get to the dining hall, student center, and your classrooms — this can save you lots of time and potential embarrassment from being late on the first day of classes. Classrooms may be organized by department in different buildings across campus.

During college orientation, you may also be able to join group outings to explore your college town or sign up for guided shopping trips to pick up groceries, cleaning supplies, and other dorm essentials.

Moving Into the Dorms

At colleges that hold orientation directly before the beginning of the semester, you may be able to sign up in advance for a block of time to park and transport your belongings into your dorm room.

With many students and families arriving on the same day, the scene can be a bit of a frenzy. Keep an eye out for registration emails prior to orientation to snag a good move-in time.

Mid to late morning is often a safe bet to get ahead of the crowds and summer heat. Also, packing efficiently can save time and stress on move-in day.

Beyond studying and sleeping, dorms are a social hive for freshmen students. A helpful college orientation tip: Setting up a welcoming, furnished dorm room is a great way to prepare for movie nights and parties with newfound friends.

Downtime for Socializing

The orientation schedule tends to wind down in the afternoon and early evening, allowing students plenty of time to hang out and get to know each other. Keeping that in mind may help you resist the urge to skip important orientation sessions to meet up with new roommates and friends.

What About Parents and Family?

While starting college is an exciting time, it can also feel bittersweet for students, parents, and other family members. To honor the occasion, many colleges incorporate group activities, lunches, and festivities for students and families to partake in together during the first day or two of orientation.

Before saying goodbyes, parents and family members may be able to join a separate orientation to prepare them for the transition. Usually, these sessions are intended to provide guidance to support students and offer insight into their child’s life at college.

They are also an opportunity for families to meet other families, as well as learn about resources and noteworthy events, such as family weekend and homecoming.

Paying for College

College orientations may also offer sessions about navigating the financial aid system. Tuition, books, and other educational costs aren’t cheap, and everyone’s financial situation is different.

Financial aid sessions may cover aid distribution dates, when tuition is due, how to pay tuition, and how to add money to student accounts for incidentals. Parents and students may want to attend this session together to ask questions that come up during the discussion.

Fortunately, there are a variety of ways to pay for higher education. In addition to saving for college ahead of time, there are several options to consider when creating a plan.

Scholarships

Scholarships are awarded to students by community organizations, private foundations, nonprofits, colleges, and other groups. The criteria for earning a scholarship varies, though many focus on academic achievement, financial need, or program of study.

According to Sallie Mae’s “How Americans Pay for College” 2023 report, approximately 61% of college students received scholarship money during the 2022-2023 academic year.

Many scholarship applications open before college starts, though there may be additional opportunities once college begins. Researching scholarships in your hometown and college is a great place to start.

Online resources, such as collegeboard.org and SoFi’s Scholarship Search Tool, keep an updated list of scholarships as well. Applying early for scholarships may be an advantage, as some large awards may have early deadlines. For instance, some scholarships stop accepting applications during the fall for distribution the next school year.

Grants

Like scholarships, grants are financial awards given to students to pay for their education — they do not have to be repaid. The main difference is that grants are usually based on need instead of academic merit. By completing the Free Application for Federal Student Aid (FAFSA), you can find out what aid you are eligible for, including the federal Pell Grant Program or state-wide grant opportunities.

Work-Study

Many college students pick up a part-time job to help pay tuition and living expenses. One way to secure work is through Federal Work-Study , a program that employs qualified college and graduate students in on- or off-campus jobs. Pay varies, but participants will earn at least minimum wage.

Work-study eligibility is based on several factors, including family income and enrollment status, and is offered as part of a student’s financial aid package.

A job is not guaranteed even if work-study is awarded. Early application is key because a school’s program funds may be limited and jobs are awarded on a first-come, first-served basis.

Student Loans

Whether or not you receive a scholarship, grant, or work-study, there are several student loan options you might want to consider applying for.

Federal student loans, which are either subsidized or unsubsidized, are offered as part of a student’s financial aid package. If you qualify for a subsidized student loan (which is based on need), interest won’t begin to accrue until six months after you graduate. With an unsubsidized federal student loan, interest begins to accrue right away (though you can defer making any payments until six months after you graduate). Interest rates on federal student loans are fixed; for the 2025-2026 academic year, the rate for a subsidized or unsubsidized federal loan is 6.39%.

Federal student loans come with such protections as deferment and income-driven repayment plans.

Private student loans from banks, credit unions, and online lenders may help fill any remaining gaps in paying for college. These loans are not subsidized or need-based, and their interest rates may be fixed or variable.

To apply for a private student loan, you generally fill out a loan application either alone or with a cosigner. Rates vary depending on the lender, but borrowers with excellent credit typically qualify for the lowest rates. These loans, however, don’t come with the same benefits as federal student loans and the rates are typically somewhat higher, so it’s generally worthwhile to first see what federal aid you can access.

The Takeaway

College orientation is an important and exciting time for students where you learn about the campus, classes, extracurricular activities, and your fellow students. It’s a good opportunity to get acclimated and embark on your independent life as a college student. You’ll also learn what supports are there, whether that means dealing with your academic workload, homesickness, or financial aid concerns.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

What should you expect at college orientation?

College orientation typically introduces you to your school, such as campus tours, extracurriculars, and financial aid practices. In addition, it gives you the opportunity to take part in fun events, meet your dorm mates and RAs, interact with university staff, and get accustomed to how college life operates.

Is it important to go to college orientation?

In general, it’s a smart move to go to college orientation. It’s a valuable introduction to college life, and it can help a student successfully transition into life at their new school. You’ll learn about where things are, academic expectation, extracurricular activities, and available resources, as well as meeting other students and university staff.

How long is college orientation?

The length of college orientation varies dramatically from school to school. In some cases, it only lasts a matter of hours; in others, it can be several days or even a week.

Do parents go with you on school tours?

The answer to whether parents go with you on school tours is that it can depend. Some students and parents definitely want to take tours together and discuss what they have seen and heard. Other students would rather go solo or visit campuses with a couple of their friends or a sibling. Lastly, don’t be surprised if a school divides the tour up into two kinds of groups, one for students and one for parents. That can be a way for students to develop their own independent view of the campus.

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