Federal student loans can be used to cover tuition and room and board, but may also be used to cover other necessary living expenses such as books or supplies for class, transportation, or the purchase of a personal computer. Read on for additional information on what expenses are covered by federal student loans.
Can I Use Student Loans to Cover Housing and Living Expenses?
Tuition is not the only thing your student loans can cover. Federal student loans can be used to pay for the college’s cost of attendance, which includes indirect and direct costs like books, transportation, and an allowance for room and board as determined by your institution.
It is important to remember that not everything can be covered by student loans, so here’s a short list directly from the federal government :
What is Covered by Federal Student Loans
• Tuition
• Room and board
• Institutional fees
• Books
• Supplies
• Equipment
• Dependent care expenses
• Transportation
• Commuting expenses
• Rental or purchase of a personal computer
• Loan fees
• Other documented, authorized costs
Other qualified expenses may include housing utilities, housing supplies and furnishings, and meals and groceries. Student loans cannot be used to cover entertainment costs. There’s actually a few things that aren’t covered by your federal loans.
What is NOT Covered by Federal Student Loans
• Travel or vacations (ahem, cannot be used for spring break)
• New vehicle
• Down payment on a house
• Entertainment
• Frequent dining out or expensive meals
• New wardrobe
• Small business expenses
• Other debt
• Someone else’s tuition
Okay, so you know what is and isn’t covered, but how can the government really tell if you are using the loans correctly? It’s a bit of a gray area, especially if you deposit any loan refund money into your bank account that’s mixed with other income.
The use of student loans for non-qualified expenses can be reported to the Office of Inspector General as fraud, abuse, mismanagement, or violation of the laws and regulations that govern federal student loans.
Using Private Student Loans to Cover Living Expenses
Private student loans may also be used to pay for qualified education expenses. These may include expenses such as:
• Tuition
• Room & Board
• Supplies and Equipment
• Personal Computer
• Transportation
Know that private student loans lack the borrower protections that come with federal student loans, including income-driven repayment plans and deferment or forbearance. Because of this, it’s generally recommended that private student loans be considered only after all other options have been exhausted.
It’s also worth noting that while private student loans can be instrumental in helping some students pay for their education. Taking out private student loans to cover frivolous expenses is not recommended.
Covering Living Expenses While in School
Aside from using student loans, there are several ways to cover living expenses while in school. Here are just a few.
Part-Time Job
Picking up a part-time job could help cover the cost of living expenses while in school. Consider opting for a part-time job that allows flexible hours or that will work with your class schedule. Some students may also be able to find part-time jobs related to their major or career-of-choice, allowing them to hone skills they’re learning in the classroom.
There is a finite amount of time during the week, so students who work while pursuing their undergraduate degrees may improve their time management skills, because they are forced to study and complete assignments during off work hours.
Students struggling with time management may want to consider tips like setting (and sticking to) a work or study schedule and limiting distractions and procrastination.
Work-Study
Federal Work-Study may also be a good option for students who qualify for the program. Federal work-study is offered as a part of a student’s federal aid package and is awarded based on financial need.
Work-study programs are available to undergraduate, graduate, and professional students, regardless of whether you are a part-time or full-time student.
Jobs are typically on campus, but may also be off-campus. Generally, work-study jobs will work with students to accommodate their class schedules. Allotted work hours are determined by the financial aid package you received.
Becoming a Resident Assistant
Another way to pay for room and board, or to help cover a portion of the cost, is to become a Resident Assistant or Advisor (RA). An RA is usually assigned to a particular floor or wing of a dormitory to oversee dorm residents. Not only do you typically get a better room than others on your dorm floor, you also get free housing.
RA responsibilities might include organizing and leading mandatory floor meetings or monthly social gatherings. And it’s possible for an RA to end up refereeing roommate disagreements, too, but hey, it could be worth it to eliminate the worry of paying for room & board.
Scholarships and Grants
Another way to cover housing and living expenses (and tuition, quite frankly) is through awarded scholarships. There are many scholarships available from private companies, nonprofit organizations, universities and colleges, and professional and social organizations.
Take an afternoon to research available scholarships that you might be eligible for, paying attention to scholarship requirements.
Recommended: Grants For College—Find Free Money for Students
Scholarship awards may have certain conditions, such as requiring that the money only be used for tuition.
On the other hand, scholarship awards may be delivered directly to you to use on whatever you want. Bottom line: consider applying!
Summer Job
As an alternative (or an addition to) a part-time job, consider a summer job or paid internship. During the summer, students may have more free time to work more hours and rack up cash to help cover their housing and living expenses for the following year.
Selling Unused or Unwanted Items
A quick way to cover housing and living expenses without going into more debt can be to sell unwanted items on buy and sell apps and websites.
Brand name clothing can be sold on apps like Poshmark and unwanted household items, electronics, and more can be sold on apps like OfferUp . It may not cover a whole month’s worth of living expenses, but it may cover a utility bill or a few groceries.
The Takeaway
Federal student loans can be used to cover living expenses, such as room and board. They can’t be used to pay for things like a spring break trip or other forms of entertainment. Students can prepare for anticipated living expenses by researching housing costs up front.
Private student loans may also be used to cover some education-related living expenses, like transportation or the cost of books and supplies for class. Private student loans lack the borrower protections afforded to federal student loans so borrowers may want to exhaust all other options before considering private student loans.
SoFi offers private student loans for undergraduate and graduate students, and parents.
Find out more about private student loans offered by SoFi.
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SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs.
SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.
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Source: sofi.com