If you’re interested in pursuing a career in the tech industry, coding bootcamps can be a quicker, more affordable alternative to getting a traditional degree. However, these courses still require a significant amount of time, energy, and money.
Are coding bootcamps worth it? They can be. You’ll want to keep in mind, however, that bootcamps vary in terms of quality, so finding a good one can take some research. In addition, the skills you learn from a bootcamp may not be enough to land the type of job or career you want.
Read on for key things you need to know about coding bootcamps. Including what they are, how they work, and how much you may be able to earn when you graduate.
Key Points
• Coding bootcamps can provide a quicker, cheaper route to tech skills than traditional degrees.
• Tuition costs for coding bootcamps generally range from $12,000 to $14,000.
• Graduates of coding bootcamps often start with salaries around $70,000.
• Funding options for coding bootcamps can include scholarships, loans, deferred tuition, and ISAs.
• Bootcamp quality varies, and additional education may be necessary for career growth.
🛈 Note: SoFi private student loans cannot be used to fund coding bootcamps.
What Is a Coding Bootcamp?
Coding bootcamps are short, intensive courses designed to provide in-depth training in software development fundamentals, and prepare students for entry-level jobs in the tech industry.
Many people consider bootcamps when pursuing a career change or looking for a shorter path into the tech industry, as they last about 12 weeks on average.
Bootcamps are conducted in both traditional classrooms and online, and are designed to accommodate students with little-to-no coding experience.
However, not all coding bootcamps are accredited schools. While some boot camps are affiliated with universities and, therefore, required to uphold the educational standards of the institution it is in partnership with, most coding bootcamps remain privately owned with educational standards that may not necessarily be governed by any scholarly entity.
Therefore, coding bootcamps, no matter how appealing, may not all produce the same quality of education or warrant any recognition outside of the tech industry.
The cost of coding bootcamp can vary widely, and will depend on the school, the length of the program, whether classes are in-person or online, and whether you study full or part time. However, on average, tuition for coding bootcamps can run around $12,000 to 14,000.
While that’s not nothing, it’s a lot less than the cost of a traditional undergraduate degree. According to College Data, the average annual tuition at a public university is $11,260 for in-state students and $29,150 for out-of-state students. The average annual tuition for a private institution is $41,540. If you pursue a four-year bachelor’s degree program, tuition can therefore be much more than a coding bootcamp.
Like colleges and universities, many coding bootcamps now offer a range of funding options, so you don’t necessarily have to pay the full cost up front and out of pocket. These may include:
• Scholarships: Some bootcamps offer scholarships for women, minorities, vets and even those experiencing hardships. You can often find out about scholarship opportunities by going to the tuition section of the bootcamp’s website.
• Loans: External loans, including private student loans, are a common way to cover the cost of bootcamp.
• Deferred Tuition: This allows students to enter and complete a coding bootcamp without upfront payment. You are required to pay back your tuition costs only after securing a job.
• Income-Share Agreement (ISA): This is a wage-garnishment agreement between a bootcamp and a graduate. It generally specifies that once a graduate accepts a job, a portion of their income will be paid to the bootcamp for a specified length of time.
Is There a Stigma About Coding Bootcamps?
While coding bootcamps were once similar to Massive Open Online Courses (MOOCs) — virtual, often free or low-cost, classes notorious for their low completion rates — many of these programs are now highly respected by employers.
Unlike MOOCs, which are structured to teach hundreds of students at a time, utilizing a primarily hands-off teaching model, coding bootcamps typically rely heavily on instructor direction. Indeed, there may be more than one instructor assigned to each class, which is often no larger than,say, 20 students.
Many programs are also highly intensive, requiring as much as 40 hours of weekly instruction. In addition, these programs tend to rely on project-based teaching methods that require students to immediately put their learnings into action.
However, there is no standardization for bootcamps, so all programs are not created equal. As a result, finding the right bootcamp can take a fair amount of time and effort.
If you are currently employed, it can be a good idea to talk to your supervisor or HR department about any bootcamps you are considering to get a sense of how the company views the program, and how completing the course could impact your career with the company. It’s also worth investigating if your employer offers a tuition reimbursement program that could help you cover the cost of bootcamp.
Completing any coding bootcamp should ultimately result in fluency in at least one coding language, such as JavaScript, Python, C++, C#, or Java. In addition, you will likely graduate with a portfolio of projects you completed during the course.
And because the goal of a bootcamp is to churn graduates directly into the tech industry, these programs often help graduates find, apply, and interview for industry positions.
Bootcamps generally don’t go much further than that, however. While starting salaries for coding bootcamp graduates average $70,000 a year, these programs may not provide all the education you need to succeed in a tech career.
Also, in some cases, coding skills aren’t enough on their own to land a job. Some employers, for example, may be looking for a broader set of skills in computer science or specialization in a certain field. Others may place high value on interpersonal or soft skills that allow you to work effectively in a team and communicate with coworkers.
Whether or not coding bootcamp is worth it depends on your career goals and the quality of the coding camp. On the plus side, coding bootcamp can train you up quickly, and they generally cost a fraction of the cost of a typical college degree. However, if you are interested in a management career or moving beyond coding, you will likely need a traditional college degree.
FAQ
Is it realistic to get a job after coding bootcamp?
Whether or not you’ll get a job right away once you’ve completed a coding bootcamp depends on several factors, such as which course you took and how in-demand the skills taught are in your area. In many cases, the coding skills can lead to a job after the bootcamp.
Is 40 too old for coding bootcamp?
No age is too old for coding bootcamp. Most people will have plenty of prior exposure to how websites and apps work, regardless of age, which can be a positive. Having an eagerness to learn and a willingness to dive in and do the work is usually most important.
How to pick a coding bootcamp?
To select a coding bootcamp, define your career goals and interests. Consider what type of course (online, in-person, a mix) will work best for you, and then zoom in on the bootcamp’s job placement rates, reviews, and career services to make sure they have a solid record. Finally, consider the cost and how you’ll pay for it.
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.
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.
If you’re applying to college or graduate school, figuring out how to pay for your education is likely top of mind. The first step for many prospective students is to fill out the Free Application for Federal Student Aid, otherwise known as the FAFSA®.
This form is your gateway not only for federal loans, but also for federal grants, work-study jobs, and even scholarships and grants available through your state or school. Filling out the FAFSA is key, since it’s how your eligibility for student aid is determined.
You might be tempted to put off filling out the application or have no idea where to start, but submitting your application early could improve your chances of earning more aid. Continue reading for more FAFSA tips and tricks to help make sure everything goes smoothly.
Key Points
• Submit the FAFSA early to maximize financial aid.
• Gather essential documents like tax returns, bank statements, and Social Security numbers before you start.
• Avoid common mistakes such as leaving fields blank and filling out the form at the same time as your parents.
• Use the IRS Data Retrieval Tool to save time and ensure accuracy.
• Fill out the FAFSA every year to maintain eligibility for aid.
Tips for Filling Out the FAFSA
The FAFSA is required in order to apply for federal student loans, grants like the Pell Grant, and scholarships. Colleges and universities may also use the information provided on the FAFSA to determine college-specific awards. This is an important first step for students figuring out how they’ll pay for college.
Here are some tips to keep in mind as you fill out your form.
💡 Quick Tip: You’ll make no payments on some private student loans for six months after graduation.
Actually Fill the FAFSA Out
Some people may not complete a FAFSA under the assumption that their income, or that of their family, is too high for them to qualify for any student aid. In reality, the government has no official income threshold to qualify for federal student aid, and there are many forms of aid on the table.
So you can’t really predict whether you might benefit. You also need to fill out the FAFSA to be eligible for any type of federal student loan. Federal loans typically come with more robust benefits when compared to private student loans, including deferment during periods of economic hardship and income-driven repayment. In addition, some colleges require the FAFSA for merit-based scholarships. You don’t want to lose out on potential financial help for lack of even trying.
If you don’t end up earning as much aid as you need, you can also search for scholarships from private organizations.
Submit As Early As Possible
Typically, the FAFSA becomes available on October 1 for the following academic year. Generally, it’s a good idea to submit the FAFSA as soon after it’s released as possible, since some aid is awarded on a first-come, first-served basis. Submitting the form early could help improve your chances of receiving financial help for college.
Most importantly, don’t miss the submission deadline. Technically, the FAFSA deadline is June 30 for the school year you are requesting aid for. But colleges have their own FAFSA deadlines, which are often much earlier than the federal deadline. Plus, each state and educational institution has its own deadline for submitting the FAFSA.
You can check state deadlines on StudentAid.gov. For individual college due dates, you can go to the website for each college you’re interested in applying to, or reach out to their financial aid offices. Make sure you submit the FAFSA by the earliest deadline of the bunch.
Prepare Ahead of Time
To simplify the process of filling out the FAFSA, it’s helpful to gather everything you need in advance. Here are some of the things you may need for both yourself and your parents (if you’re a dependent):
• Social Security Numbers, or Alien Registration Numbers for noncitizens If you don’t know these, you can request them from the Social Security Administration or U.S. Citizenship and Immigration Services.
• Driver’s license numbers
• Tax returns For the 2026–27 academic year, you’ll be asked for your 2024 tax information, which can typically be transferred directly from the IRS. If you or your parents have had a change of income since that tax return, you may need to let the financial aid departments of the schools you’re applying to know directly.
• Records of assets you or your parents own This can include bank statements showing savings and checking account balances or records of investments such as stocks, bonds, or real estate, excluding the family home.
• Records of income that isn’t taxed This might include child support or interest.
• Federal school codes for the institutions you’re applying to You can find these on the Department of Education website. Include every school you’re even remotely considering, even if you haven’t yet submitted your application or been accepted. There are no repercussions if you end up listing schools you don’t apply to or get into. However, if you add a school later, there may be less financial aid available.
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No late fees, & insufficient fund
fees when you take out a student loan with SoFi.
Apply Online
You can request a paper form, but if possible, submitting your FAFSA online is the quickest and easiest way to submit your application. Make sure you are on the official Student Aid website, which should end in “.gov.” If you’re asked to provide credit card information, you’re in the wrong place (after all, “free” is in the form’s name).
Before you get started, you’ll need to create an FSA ID on StudentAid.gov. This is the username and password you’ll use to electronically sign your FAFSA, as well as to prefill information in future years, since you’ll need to fill out the FAFSA each year you want to apply for student aid.
If you are a dependent student, your parents will need to create an independent FSA ID. Because this ID serves as an official signature, you should create your own and not share it with anyone.
Take Advantage of Time Savers
Besides using an FSA ID, another way to speed up the application process is to use the IRS Data Retrieval Tool. This allows you to automatically populate answers to some questions on the FAFSA with information from you or your parents’ federal income tax returns. This not only saves time, but is also a good way to make sure you submit accurate numbers.
Get Help if You Need it
If you’re confused about something, don’t worry — and don’t ignore it. First, check the frequently asked questions on the FAFSA website. If that doesn’t help, you can contact the Federal Student Aid Information Center by chat, email, or phone.
Common Mistakes to Avoid
Every year, certain errors crop up again and again in FAFSA applications. To help prevent delays in your financial aid, it’s worth ensuring you aren’t making these common mistakes:
Leaving Fields Blank
Leaving fields blank can result in errors when filing your application. Instead, write “0” or “N/A” where relevant.
Filling Out the Application at the Same Time as Your Parents
The FAFSA will require financial information from both you and your parents. As mentioned, both you and your parents will have your own FSA ID information to log in and make changes to the FAFSA application. If you log in at the same time, you risk both of your changes not being saved properly.
Providing Incorrect Information
The FAFSA requires a lot of personal and financial information. Making careless errors or submitting incorrect information can cause issues with your application. For example, make sure you submit the correct Social Security number. If you don’t use this number often, you may not know it by heart. But being one digit off here can throw things off.
Issues can also occur if you are providing the wrong figures for investments. Carefully follow the instructions to report student and parent investments in the right place and understand what to include or exclude.
Take your time and read the questions carefully. Breezing through the application in a rush can potentially lead to wrong answers or missed fields.
The FAFSA isn’t a one-time deal. Most schools require you to re-apply every year, so make sure you stay on top of deadlines.
💡 Quick Tip: Would-be borrowers will want to understand the different types of student loans that are available: private student loans, federal Direct Subsidized and Unsubsidized loans, Direct PLUS loans, and more.
The Takeaway
Filling out the FAFSA is the first step to getting the financial aid many students need to make college or graduate school a reality. A few tips to help you toward FAFSA success include: reading the application closely, making sure you have the most up-to-date financial information at hand when you are ready to submit, and submitting the application as early as possible. And don’t forget, you’ll need to submit an application annually.
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
How do I maximize my FAFSA money?
To maximize your FAFSA® money, submit your application as early as possible, since some aid is awarded on a first-come, first-served basis. Report accurate information and avoid overestimating income or assets, which can reduce eligibility. It’s also wise to list multiple schools to expand your aid opportunities and to research state and school deadlines in addition to the federal deadline.
What is the #1 most common FAFSA mistake?
One of the biggest FAFSA® mistakes is failing to complete the form at all, often due to the misconception that income is too high to qualify for aid. Many families miss out on federal grants, work-study programs, and even low-interest loans because they don’t apply.
Another common FAFSA mistake is leaving blank fields, or skipping questions. Leaving multiple blanks can cause miscalculations and even rejection of your application. If a question does not apply to you, enter a “0” or “not applicable” instead of leaving a blank.
What are 5 tips for filling out the FAFSA?
1. Apply early — funds are limited and some aid is first come, first-served.
2. Use the IRS Data Retrieval Tool for accurate tax information.
3. List multiple schools to maximize aid opportunities.
4. Don’t skip questions — leaving blanks can reduce eligibility.
5. Review before submitting to catch errors in Social Security numbers, income, or asset reporting.
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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.
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.
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
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Many students in the U.S. take out loans to help pay for the cost of college, which now averages $38,270 a year, according to the Education Data Initiative.
The two major types of student loans are federal student loans and private student loans. Knowing how these different types of student loans work can help you figure out the best way to pay for your education.
Key Points
• Federal student loans offer flexible repayment options, as well as benefits such as deferment and forgiveness.
• With Direct Subsidized Loans, the government pays the interest while the borrower is in school.
• The government does not cover the interest on Direct Unsubsidized Loans.
• Direct Consolidation Loans may simplify repayment by merging multiple federal loans into one.
• Refinancing private loans can potentially lower interest rates but forfeits federal benefits.
Federal vs Private Student Loans
There are important distinctions between federal and private student loans. Federal student loans are backed by the U.S. Department of Education. Borrowers do not need to undergo a credit check to take out most of these loans, and the loans come with federal benefits and protections, such as income-driven repayment (IDR), deferment, forbearance, and access to the Public Service Loan Forgiveness (PSLF) program. The interest rates on newly issued federal student loans are fixed and set by law.
Private student loans are offered through financial institutions, including banks, online lenders, and credit unions. Students must undergo a credit check — or have a student loan cosigner to help them qualify. Each lender has its own interest rates and terms. Private student loans are not eligible for federal benefits like deferment and forgiveness.
For many borrowers, it makes sense to take out federal student loans first because they come with flexible repayment options and other federal benefits. Students may then want to fill any gaps with private loans.
Repay your way. Find the monthly
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Federal Student Loans
There are several different types of federal student loans. Understanding each type can be helpful as you work on financing your education.
Direct Subsidized Loans
Direct Subsidized Loans are based on students’ financial need. The government covers the accrued interest on these loans while the borrower is enrolled in school, during the six-month grace period after graduation, and during any periods of deferment. Direct subsidized loans are for undergraduate students only.
The interest rate for Direct Subsidized Loans disbursed after July 1, 2025 and before July 1, 2026 is 6.39%.
Direct Unsubsidized Loans
These loans are available to undergrads, graduate students, and professional students. The government does not pay the interest on Direct Unsubsidized Loans. Payments are not required as long as borrowers are full-time students, but the interest accrues and is added to the loan’s principal.
The interest rate for Direct Unsubsidized Loans for undergraduates that are disbursed after July 1, 2025 and before July 1, 2026 is 6.39%. The rate for Direct Unsubsidized Loans for graduate and professional students is 7.94%.
Interest Capitalization and Federal Borrowing Limits
Unpaid interest can capitalize on Direct Unsubsidized student loans. Interest capitalization is when unpaid interest accrues over time and gets added to the principal loan balance, and then accrues more interest. This results in borrowers paying more over the life of the loan.
Students have the option to make interest-only payments on their Direct Unsubsidized Loans while they’re in school and during other periods of deferment, which can help prevent interest capitalization.
The borrowing limits for federal student loans vary depending on a student’s year in school and whether they are a dependent or independent student. For example, first-year undergrads who are dependents (generally meaning they receive parental financial support) have a maximum borrowing limit of $5,500 their first year; of that amount, only $3,500 can be subsidized. Students who are considered independent have a maximum borrowing amount of $9,500 annually, with the same $3,500 cap on subsidized loans.
PLUS Loans
Direct PLUS Loans can currently be borrowed by a graduate student (these loans are often referred to as Grad PLUS Loans) or by an undergrad’s parents (known as Parent PLUS Loans). Like the other Direct loans, PLUS loans have fixed interest rates and federal benefits, such deferment and forgiveness. Unlike other federal loans, PLUS loans require a credit check. Interest rates for all Direct PLUS Loans disbursed after July 1, 2025 and before July 1, 2026 is 8.94%.
The maximum yearly amount a Grad PLUS Loan borrower can currently take out is $20,500. The maximum amount a Parent PLUS Loan borrower can receive is the cost of attendance at their child’s school minus any other financial assistance received.
However, due to upcoming changes to student loans as part of the new domestic policy bill, Grad PLUS Loans will be eliminated for new borrowers on July 1, 2026. There will be just one type of federal student loan available to graduate and professional students as of July 1, 2026 — the Direct Unsubsidized Loan.
In addition, graduate students will have new lending limits through the Direct Unsubsidized Loan program. This includes an annual limit of $20,500 for graduate students with a $100,000 lifetime limit. Professional students, such as medical and dental students, may qualify for a Direct Unsubsidized Loan with a yearly limit of $50,000 and a lifetime limit of $200,000.
Borrowers who already have Grad PLUS Loans before the above changes take place can continue to borrow money under the current limits for three additional academic years.
Parent PLUS loans will also have new borrowing limits. For loans disbursed on or after July 1, 2026, parents can borrow $20,000 a year, with a lifetime limit of $65,000 per student.
Direct Consolidation Loans
Borrowers who have a number of different federal student loans may want to combine all their federal loans into one loan to simplify payment. They can do this with student loan consolidation.
A Direct Consolidation Loan allows students to combine their federal student loans to make managing their loans easier. This loan will not typically lower your interest rate, however. The interest rate on a Direct Consolidation Loan is a weighted average of the interest rates on your existing student loans, rounded up to the nearest eighth of a percent.
Consolidating your federal student loans could lower your monthly payment by extending your repayment timeline. But you’ll generally end up paying more overall because of the additional interest incurred when lengthening your loan term.
How to Apply for a Federal Student Loan
To be eligible for a federal student loan, students must fill out the Free Application for Federal Student Aid (FAFSA®). On the form, they’ll answer questions about their family finances, as well their education plans. Even students who don’t think they will qualify for financial aid should still fill out the FAFSA. That’s because some schools use information from the FAFSA to determine eligibility for other types of aid like scholarships or grants. The FAFSA must be filled out and resubmitted every year.
After filling out the FAFSA, students may receive a financial aid package of grants, work study, and federal loans. Depending on your financial circumstances, the loans will either be subsidized or unsubsidized.
It can be helpful to consult a FAFSA guide before you start working on the application.
Private Student Loans
Students who don’t receive enough federal aid may want to consider private student loans to help finance their education. Private loans are offered by banks, online lenders, and credit unions, and they require a credit check, unlike federal loans.
Undergraduate Loans
Private undergraduate student loans may have fixed or variable interest rates. Students, who typically don’t have a robust credit history at this point in their lives, may want to apply with a cosigner to help qualify for a lower interest rate.
Graduate Loans
Some private lenders offer private student loans specifically for graduate students. These graduate loans may come with special features, such as longer grace periods and in-school deferment. Graduate students, who might have had more time to develop a solid credit history, may not need a cosigner.
Parent Loans
There are also private loans that parents can take out to help pay for their child’s education. Like other private student loans, parent loans typically have fixed or variable interest rates. Private loans for parents may require that payments begin right away. But some lenders offer an option for interest-only payments while your child is in college. Shop around with different lenders for the most favorable terms.
Student Refinancing Loans
Another option is student loan refinancing. When you refinance your loans with a private lender, you exchange your old loans for a new loan with new rates and terms. If you qualify for a lower interest rate, it could reduce the amount of interest you pay over the life of the loan and help you save money.
You could also lower your monthly loan payments by extending your loan terms. However, you pay more interest over the life of the loan if you refinance with an extended term.
It’s possible to refinance both private and federal student loans. But it’s important to note that refinancing federal loans makes them ineligible for federal programs and protections. If you think you might need these programs, refinancing may not be the best option for you.
How to Apply for a Private Student Loan
Borrowers interested in private student loans can fill out a loan application with a lender. Before applying, you can prequalify to see what rate you can get. This can be helpful for shopping around and evaluating different lenders for the best crates and terms.
The terms, interest rates, and borrowing limits on private loans vary by lender. Lenders use factors like the borrower’s credit score to determine the interest rate they qualify for. When borrowing a private student loan you’ll generally have the option to choose between a fixed or variable interest rate.
Private lenders offer different student loan repayment options. Some offer deferment plans while the borrower is enrolled in school, and others require payments to start as soon as the loan is disbursed.
The Takeaway
The two main types of student loans are private and federal. Federal loans are backed by the government, have a fixed interest rate, and are eligible for a variety of federal benefits. Private student loans are offered by private lenders. They involve a credit check, and you may need a cosigner on the loan to get the best rates and terms. Borrowers can choose fixed or variable rates.
It’s possible to refinance student loans in the future for a lower rate and more favorable terms if you are eligible.
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 federal and private student loans?
Federal student loans are offered by the U.S. Department of Education to help students cover the cost of college. These loans typically don’t require a credit check, and they have fixed interest rates that are set each year. Federal loans have federal benefits and protections, such as deferment and forgiveness.
Private student loans are offered by private lenders, such as banks, credit unions, and online lenders. These loans require a credit check and students may need a cosigner in order to qualify. Each lender offers its own interest rates and terms. Private student loans are not eligible for federal benefits.
How do I know which type of student loan I have?
You can identify the types of federal student loans you have on the Federal Student Aid website (StudentAid.gov). Log into your account and go to the “My Loans” section of your dashboard to see a list of your student loans with information about each one, including the type of loan it is.
For private student loans, contact your loan servicer — their contact information should be listed on your monthly billing statement. You can also check your credit report (you can get a free copy from one of the three credit bureaus) for information about all your student loans, including private loans.
Can I refinance both federal and private student loans together?
Yes, you can refinance federal and private student loans together. You’ll replace your existing loans with one new private loan with new rates and terms. Just be aware that refinancing federal student loans means you’ll lose access to federal benefits like federal deferment and forgiveness. Make sure you won’t need those programs before you refinance federal student loans.
Do all student loans require a credit check?
No, most federal student loans, such as Direct Subsidized and Unsubsidized student loans, do not require a credit check. The only federal loans that require a credit check are Federal Direct PLUS Loans for graduate and professional students and parents. Private student loans do require a credit check.
Which student loan type offers the best repayment flexibility?
Federal student loans generally offer more flexible repayment options than private loans do. Borrowers with federal student loans can currently choose from income-driven repayment, student loan deferment or forbearance to temporarily postpone payments, and access to student loan forgiveness programs. Private student loans typically have limited repayment plans, though some do offer options like interest-only payments and limited deferment or forbearance.
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).
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.
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).
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If you’re facing financial hardship, going back to school, or running into another issue that makes it tough to pay your student loans, you may be looking for relief. One option may be student loan deferment, which allows you to temporarily pause your student loan payments. Note that the rules around student loan deferment will be changing for loans issued after July 1, 2027, which we’ll explain below. As with most financial decisions, there are pros and cons to deferring your student loans. Here’s more information about student loan deferment and what it could mean for your financial future.
Key Points
• Student loan deferment currently allows you to pause or reduce payments if you’re enrolled at least half-time, facing financial hardship, serving in the military, or in other qualifying situations.
• Deferment for economic hardship and unemployment won’t be available for loans issued after July 1, 2027.
• Subsidized loans do not accrue interest during deferment, while unsubsidized loans do, increasing overall repayment costs.
• Applying for deferment requires a request through your loan servicer, and some students may be granted deferment automatically.
• Deferment pros: Provides temporary relief from payments, especially during financial hardship or further education.
• Deferment cons: Interest accrues on unsubsidized loans, potentially increasing total loan costs over time.
What Is Student Loan Deferment?
Deferment is a program that allows you to temporarily stop making payments on your federal student loans or to temporarily reduce your monthly payments for a specified time period.
This is similar to another option known as forbearance. However, unlike forbearance, you may not be charged interest while your loan is in deferment. According to the Department of Education, if you hold one of the following types of loans, you will not be responsible for paying interest on your loan while it is in deferment:
• Direct Subsidized Loan
• Subsidized Federal Stafford Loan
• Federal Perkins Loan
• The subsidized portion of a Direct Consolidation Loan
• The subsidized portion of a Federal Family Education Loan (FFEL) Consolidation Loan
If you have one of the following types of loans, you will be responsible for paying the accrued interest on your loan while it is in deferment:
• Direct Unsubsidized Loan
• Unsubsidized Federal Stafford Loan
• Direct PLUS Loan
• FFEL PLUS Loan
• The unsubsidized portion of a Direct Consolidation Loan
• The unsubsidized portion of a FFEL Consolidation Loan
If you are responsible for paying interest on your student loans while they are in grad school deferment, you have two options: 1) you can make interest-only payments on the loans while they are in deferment; 2) if you choose not to make these interest-only payments, the accrued interest will capitalize (be added to the loan principal) when the deferment period is over.
💡 Quick Tip: Ready to refinance your student loan? With SoFi’s no-fees-required loans, you could save thousands. (You may pay more interest over the life of the loan if you refinance with an extended term.)
How Do You Qualify for Student Loan Deferment?
In order to qualify for the current student loan deferment program, you must meet one of the following requirements:
• You’re enrolled at least part-time at a qualifying university
• You’re unemployed or unable to find employment (for up to three years)
• You’re experiencing an economic hardship
• You’re currently volunteering in the Peace Corps
• You’re on active-duty military service (or are in the 13 months following that service)
• You’re in an approved graduate fellowship program
• You’re in an approved rehabilitation program (for disabled students)
Due to recent legislation, deferment for unemployment and financial hardship will no longer be available for loans issued on or after July 1, 2027.
Requesting a Deferment
If you’re interested in deferring student loans to go back to school, you’ll need to apply for an in-school deferment. Most likely, you will request the deferment directly through your loan servicer—there is usually a form for you to fill out. When you request a deferment, you’ll also need to provide some sort of documentation to prove that you qualify for a deferment.
If you are enrolled in an eligible college or career school at least half-time, your loan may be placed in deferment automatically . If it is, your loan servicer will notify you that deferment has been granted. If you enroll at least half-time and do not automatically receive a deferment, you will need to contact the school in which you are enrolled. The school will then send the appropriate paperwork to your loan servicer, so that your loan can be placed in deferment.
Pros and Cons of Student Loan Deferment
The biggest benefit of student loan deferment is the ability to temporarily postpone student loan repayment. As of the second quarter of 2025, 3.5 million borrowers had their loans in deferment.
If you are deferring for extreme financial hardship, deferment allows you to free up money to pay off bills that require immediate attention like rent or electricity.
For students who have qualified for deferment through community service, like a stint in the Peace Corps, deferment gives them the opportunity to serve their community without any added stress from student loan payments.
While temporarily pausing loan repayment may seem like a blessing, it can come at a cost, especially if your student loans are not subsidized by the government. When in deferment, interest continues to accrue on your loan. And at the end of your deferment period, that interest will be capitalized on the loan. (This means that the accrued interest will be added to the principal balance of the loan. So ultimately, you’ll be paying interest on top of interest.)
This can mean you end up paying even more money over the life of the loan. To see how much deferring your student loans could cost, you can use an online calculator to get an estimate of how much interest will accrue while the loan is in deferment. If it’s too costly, you may consider alternative student loan repayment options.
If you have private loans that aren’t eligible for federal student loan deferment, refinancing your student loans is another option to consider. You may also want to think about refinancing when you’re done with your graduate degree to pay off your loans at a potentially lower interest rate.
When you refinance, your existing student loans are paid off with a new loan from a private lender. If you are refinancing private loans before going back to graduate school, you may be after a lower monthly payment, which you could potentially qualify for when refinancing your loans and extending the loan term. (You may pay more interest over the life of the loan if you refinance with an extended term.)
Alternatively, if you’re looking to refinance after graduate school, you could potentially qualify for a lower interest rate, which could reduce the amount of money you spend over the life of the loan. The lender will use your credit score and earning potential to determine what interest rate you’ll qualify for. And thanks to your new graduate degree, you could have significantly increased your earnings.
Another big benefit of student loan refinancing? You’re able to combine all of your student loan payments – for both federal and private loans – into one easy-to-manage payment.
If you hold only federal student loans, however, you could look into a Direct Consolidation Loan, which allows you to consolidate federal loans into one loan with a single monthly payment. The new interest rate will be the weighted average of your current interest rates (rounded to the nearest one-eighth of 1%), so unlike refinancing, when you consolidate your student loans, you won’t necessarily qualify for a lower interest rate.
If you are taking advantage of your federal loans’ flexible repayment plans or student loan forgiveness programs (or if you are planning to do so), refinancing might not be the best option for you. A major con of student loan refinancing is that you’ll lose access to federal loan benefits when refinancing with a private lender — including deferment and income-driven repayment plans.
The Takeaway
If you’re a student heading back to school, you may be able to temporarily pause your federal student loan payments through deferment. While subsidized loans won’t accrue interest during deferment, unsubsidized loans will, which could increase your total loan cost. You can apply for deferment through your loan servicer, and some students may even be granted it automatically if enrolled at least half-time.
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.
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).
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.
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.
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.
Even if college is several months or a few years away, high school can be a great time to start saving for future college expenses. This is especially true as the cost of higher education continues to climb.
Just making a few simple moves, like picking up a part-time or summer job and signing up for AP classes (which may allow you to skip some college classes and save on tuition), can go a long way once you get to campus.
Read on for more tips on how to start saving up money for college while you are still in high school.
• High school students can start saving for college by working part-time jobs and setting aside earnings in a dedicated savings account for future expenses.
• Enrolling in Advanced Placement (AP) classes allows students to earn college credit, potentially saving on tuition and enabling early graduation.
• Maintaining a budget helps in tracking income and expenses, encouraging savings for college and preparing for financial responsibility in college.
• Utilizing high-yield savings accounts can grow college funds faster by offering higher interest rates, making saving easier through automatic transfers.
• Researching scholarships and grants provides opportunities for free financial aid, reducing college costs and easing future financial burdens.
Advancing Yourself With AP Classes
Achieving an AP Exam score of 3 or higher may allow incoming freshmen to skip introductory college courses or gain credit toward graduation. The College Board reports that nearly all colleges and universities in the U.S. offer credit, advanced placement, or both based on your AP scores.
Most colleges have a policy outlining the minimum scores needed to earn credit for specific AP Exams, plus how much credit will be awarded and how it applies to your degree or graduation requirements. The College Board offers an AP credit policy search online, but it’s wise to double check with your individual school.
Earning college credit before you even step foot on campus freshman year can be a great way to save money on future college classes in the long run. You might even be able to graduate early, which could mean thousands of dollars in savings depending on which university you attend. Of course, there are fees to take the AP Exams, but that amount may be offset by the amount of credit hours you’re able to gain if you score well.
Picking Up a Part-Time or Summer Job
Working in high school and setting aside at least a portion of your earnings in a savings account earmarked for college can definitely come in handy when it comes time to cover expenses like books, meals, entertainment, or off-campus rent.
Recently, some companies with part-time and entry-level jobs — perfect for high school students — have started offering tuition support or reimbursement for eligible employees. At Starbucks, for instance, part- and full-time employees are able to get 100% of their tuition reimbursed for a first-time bachelor’s degree through Arizona State University’s online program. Working at Chipotle, you may also be able to receive some tuition assistance every year.
Managing Expenses by Budgeting
It’s never too early to start good money habits, such as maintaining a balanced budget. You might start with a simple spreadsheet that tracks your monthly income (like allowance or any paychecks you earn) as well as your monthly spending, separating your expenses into essential and nonessential. You may be able to free up more money for college savings by cutting back on nonessential expenses. The popular 50/30/20 budget rule suggests putting 20% of your income toward savings for long-term money goals, like saving for school.
Starting to save in high school could potentially help minimize the financial burdens you face during college. Maintaining a budget in high school could also help prepare you for keeping your expenses in line as a college student.
When making a college budget, make sure you research what things like books, transportation, rent, and groceries are going to cost in the area. You can then look at what you might be able to cut in order to save more, like smaller meal plans, off-campus housing, renting used textbooks, or taking the bus rather than bringing your car.
A high-yield checking or savings account could earn you significantly more money by paying a higher-than-average interest rate. This could help your college savings fund grow more quickly.
If you earn a regular paycheck, one easy way to save is to split up your direct deposit between your checking and savings account. This way, you guarantee some money automatically ends up in savings, making it a little harder to spend. You could also set up an automatic transfer within your account so that you don’t have to constantly remind yourself to save.
Researching Scholarships and Grants
Scholarships and grants are both forms of aid that don’t need to be repaid, essentially making them free money. Getting a scholarship, or a few, can go a long way in lessening the financial burden you face in college. Some scholarships are awarded to incoming freshmen so spending some time researching scholarships and grants could pay off in the long run.
There are online databases, like FastWeb or Scholarships.com, that aggregate information about different scholarships and what their application process looks like. Each scholarship is likely to have their own eligibility criteria and application requirements so pay attention to the details when you are applying.
Different Ways to Pay for College
The U.S. government offers aid in the form of federal student loans, but also grants and some scholarships, which can significantly reduce the cost of college. It’s important when applying to schools to consider all of the costs involved. You can estimate your financial aid online ahead of time, so you can make an educated decision about where to attend school.
Filling out the FAFSA form every year is an important step toward securing federal aid, including merit-based scholarships and federal student loans.
If savings, financial aid, and federal student loans aren’t enough to pay for college, private student loans are another option to consider. These loans are made by private lenders and aren’t required to follow the same regulations as federal student loans. Because of this, they lack the borrower protections afforded to federal student loans and are generally considered an option only after all other sources of funding have been reviewed.
The Takeaway
High school is the perfect time to start preparing for college and how you’ll pay for it. Taking on a summer or part-time job can boost your income and allow you to start socking away money for future college expenses. Other ways to make the cost of college more manageable include taking AP classes, researching scholarship options, applying for federal financial aid, and taking out federal or 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.
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 much should a high school student save for college?
There is no one set amount that a high school student should save for college. Much depends upon individual circumstances. However, the rule of thumb is that it can be wise for families (parents, relatives, and the student) to save up one-third of the costs and finance the rest. College tours are a good way to gain insights into a campus and how it operates. You can also hear from a student guide about important insider topics and ask questions from a current student.
What are good ways for a student to save for college?
Getting a job, whether part-time or full-time over the summer, is one good way for a student to accumulate funds for college. Taking AP classes can also be helpful, as a good score on the AP Exam can help a student place out of introductory courses and potentially graduate early. This can result in significant tuition savings.
What if I don’t use up 529 funds for tuition?
If 529 funds aren’t used by a student, they can likely be transferred for use by another family member on qualifying expenses, used to pay down student loans, or withdrawn for nonqualifying expenses (which can trigger taxes and penalties), among other options.
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. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.
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.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.
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. Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®
