By Billy Stafford
One of the problems you may have to solve when completing a student loan application is deciding whether to borrow for your cost of living, and if so how much. We here at Climb Credit want to make sure you have the right information and support in order to best solve these problems. Below are three frequently asked questions we get from borrowers relating to student loan living expense financing. If you have asked yourself the same questions, we encourage you to review our answers!
How much can I borrow for living expenses?
The answer to this question is most often dependent on the school you attend. Typically, the maximum amount you can borrow for living expenses is around $3,500 to $4,000. If you are unable to select any value for cost of living financing in your Climb Credit application, we recommend reaching out to your school contact and expressing your interest in borrowing for living expenses.
How much should I borrow for living expenses?
The simple answer: only what you need. It’s important to keep in mind that any money you borrow you will have to repay, along with the interest that accumulates while the loan is still outstanding. Take into consideration that while you are in school, you may find yourself spending far less than you do now because you will be replacing leisure activities with time spent in class and studying.
We suggest sitting down and creating a budget for yourself that spans the time you are in your program and a period of time after your program ends — typically we see people use three months, but it depends on your personal situation. Your budget should include housing (usually rent), food, utilities, transportation, equipment for your course (computers, books, etc), and medical expenses. Once your budget is complete, we typically see students use savings to cover expected costs and request living expense financing to help out with the remaining expenses.
For example, if you have $1,800 saved up, and you anticipate you will need approximately $3,000 to cover the costs of housing, food, and transportation while you attend your program, you might want to borrow $2,000 instead of the entire $3,000. By using your available savings, you can still afford your living expenses while potentially saving money that may have gone to financing charges!
There are many great free tools available online if you are having difficulty estimating how much you will have to spend on a monthly basis. This calculator is an example of a (free!) resource that can help you determine how much to budget based on where you live!
When will I receive my living expenses funds?
We at Climb work hard to send out funds as quickly as possible, after the school has provided confirmation of attendance. Given that this process can take some time, we always suggest that you have enough savings to cover your expenses for the first month you attend your program.
Your success is paramount to us — we want you to have every opportunity to achieve your goals! If you’re still unsure about how much you should borrow for living expenses, remember that you can always contact Climb Credit via live chat, email, or phone!