Worried about debt? let’s talk about the benefits of student loans first. Can you use student loans for anything? Even a business? Click here to learn more!
No one ever said starting your own business was going to be easy. But you’re not branching off on your own because it’s easy, you’re doing it to make a name for yourself and your life. Challenges be damned.
One of the biggest challenges you’ll run into is financing your company. Especially at the beginning of the process, they’ll be a number of costs that you simply just won’t be able to get around.
There’s a number of routes you can take to try to raise money for your business. Those that are still in school may be tempted to use the money left over from their student loans– but is this allowed? Can you use student loans for anything?
Read on, and we’ll walk you through exactly what you can and can’t use student loans for.
Can You Use Student Loans For Anything?
Most students at four-year universities tend to take out some kind of loan. An average of 77% of college students do, typically in amounts totaling between twenty and forty thousand dollars.
The bulk of the best student loans usually go directly into tuition fees and housing. But often times, leftover totals are given to students by check. This extra cash is typically intended to be used on expenses relating to education, such as textbooks, a laptop, or transportation costs.
And yet, many students around the country frequently use this money for other purposes. According to a survey, nearly one-third of college students admit to using student loans on non-educational purchases including dinner, alcohol or even spring break trips.
Is this legal? Kind of. When you apply for a student loan, you are making an agreement to use the money towards your education. But from most lenders, there is no requirement that states that your spendings must be reported. What you spend the extra money on remains a secret between you and yourself.
The Benefits Of Student Loans
Using a student loan to help finance a business is an unorthodox approach, but there are a number of benefits to it. Student loans have notoriously low-interest rates. They are typically much lower than you’d find on a standard business loan or even credit card bill.
Borrowing from one’s student loan also helps to postpone when you’ll need to pay the bill. Using credit cards to fund your business, for example, only gives you a small window before you’ll be asked to pay up. Your student loans have a much longer gestation period.
Depending on the size of the loan you take and the costs of your tuition, the amount of money from your loan that you’ll actually be able to put towards your business may be somewhat small. But even a little bit can help, and you can always combine the money with more from other sources.
Starting Your Business With Student Loans
“Can you use student loans for anything?” is a common question asked by many students across the country, and the answer isn’t necessarily black and white. But if you’re looking for some extra cash to start your business, leftover money from your student loans is a potential source.
Need more entrepreneurial advice? Check out our blog for more tips and tricks.