Every time I read the news, I hear how America’s problems with student loan debt have gotten worse.
For example, I learned recently that collective student loan debt surged to over $1.4 trillion nationally. And in an article in the Wall Street Journal, I learned that more than 7 million student borrowers were at least one year behind on their payments.
Also, average student loan debt is up to over $37,000 this year, leaving many young adults questioning their future prospects. With so much debt at a young age, more young people are putting off marriage and parenthood than ever before.
So, what should people do?
No matter where you are with your loans, you can make your situation better (or worse) depending on what you do from here on out.
To learn about some of the mistakes students, borrowers and even co-signers should avoid, I reached out to several financial planners who have experience in this space. When it comes to student loans, they say to avoid these six mistakes at all costs.
Read more: 9 ways to pay for college without student loans
1. Choosing a four-year school without researching other options
According to wealth adviser Joseph Carbone of Focus Planning Group in Bayport, New York, too many young people assume they need a four-year degree without thinking it through. And once they get into their four-year degree program, they start racking up more debt than they need. A lot of times, at least some of these students would be better off pursuing a two-year program first.
As Carbone notes, this is especially true in the state of New York, where kids can attend a two-year SUNY program at a considerable discount.
“If you start with a good SUNY two-year program, and then transfer to the school of your choice, you could save tens of thousands of dollars,” he says.
If you already graduated, this tip can’t help you now. But if you’re gearing up for school, it can pay to explore some of the degree options two-year schools offer. A lot of times, you can begin lucrative careers with a two-year degree or even an apprenticeship.
“Parents and students have to accept the idea [that] there is a flood of college graduates with limited job prospects,” says financial planner Tom Diem of Diem Wealth Management. Meanwhile, there are also many unfilled, high paying jobs in technical fields.
Because of this, says Diem, you need to think about long-term value when choosing a program.
And remember, like Carbone says, you can always start with a two-year degree, then transition to a four-year program later.
2. Living off your student loans
Depending on the student loans you choose, you may be able to borrow more than the cost of your tuition and books. When that’s the case, it’s tempting to spend the “overage” on a lifestyle you couldn’t afford otherwise.
But, just because you can use student loans for a Spring Break trip to Mexico doesn’t mean you should. Remember, you have to pay back every cent you borrow – plus interest.
Kansas City financial planner Clint Haynes says he has seen this situation play out time and again, with disastrous results.
“Student loans should only be used [for] education expenses, not going out to the bar with your friends,” says Haynes.
Yes, you may need to get a part-time job or be more frugal with the money you saved from your summer job. However, you will be so grateful you did after you graduate and start paying your bills.
“The goal is to get your degree with as little debt as possible,” he says.
Once you graduate and start earning a real income, then you can go to Cancun.
Read more: 11 best ways to find a college scholarship
3. Dismiss working during school
Sure, you can borrow enough to cover your tuition and your living expenses, but should you? According to financial planner Josh Brein of Brein Wealth Management in Bellevue, Washington, you can make your life easier by working during school and borrowing less.
“I’m a huge advocate of working while you’re learning, because it teaches us that money doesn’t grow on trees,” says Brein. Plus, you can use some of your earnings to pay for school along the way. You don’t have to prepay all of your tuition, of course, but any amount you can pay will help.
4. Co-signing without understanding the potential consequences
This tip is for parents and guardians that might co-sign on a student loan. A CBS News Money Watch article from August 2014 stated that nearly 156,000 older Americans saw their Social Security checks dinged the previous year for delinquent student loan payments.
Because student loan delinquencies are on the rise, you should think long and hard before attaching your name to a brand new loan.
“Parents and grandparents co-sign with the best of intentions but often without thinking about the financial ramifications if the student doesn’t pay,” says Charles C. Scott, a financial adviser in Scottsdale, Arizona. “Be aware and be careful,” he says. If the person you co-signed for quits paying, you’ll be on the hook.
Read more: The dangers of co-signing a student loan
5. Refinancing without running the numbers
Oftentimes, new graduates assume refinancing is a good deal without ever running the numbers or considering what they’ll lose.
“Don’t make this mistake,” says Portland, Oregon-based financial planner Grant Bledsoe. “Private lenders do offer competitive rates when refinancing, but by leaving the federal system, you forfeit many of the associated benefits.”
Any time you refinance a federal student loan with a private lender, you miss out on certain protections like income-driven repayment plans, deferment and forbearance. So even if you get a lower interest rate by refinancing, you’re barring yourself from choosing these options down the line.
“Refinancing is the best option in some circumstances, but be wary of what you’re giving up,” says Bledsoe.
6. Paying off student loans instead of other high-interest debts
While it’s reasonable to see your student loan debt as an emergency, paying off other debts first — while making your minimum monthly student loan payments — might leave you better off.
“If you have other loans with high interest rates, make sure to prioritize those for repayment first,” says financial advisor Billy Xiao of Mobius Wealth, in Vancouver.
If you have high interest credit card debt or personal loans, for example, you can easily save more on interest by making extra payments on those first. And since you might be able to deduct the interest you pay on student loans on your taxes, there are additional financial considerations to ponder as well.
To reiterate, that does not, of course, mean skipping student loan repayments so you can make the other payments with higher interest rates. Skipping repayments and possibly going into default can have very serious consequences for your credit scores. The bottom line: Make sure to take a holistic look at your finances before paying extra toward your student loans. Sometimes, other debts should take precedence.
While a college degree can certainly pay off, borrowing unlimited amounts of money can make your post-college life harder than it has to be. Before you sign on that dotted line, make sure you know exactly what you’re getting into. With a few smart moves and some self-restraint, you can borrow less, pay down debt faster and avoid many of the pitfalls that befall too many college graduates with debt.
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This article originally appeared on Credit.com.
Read more: Clark’s student loan guide