6 strategies to help students avoid excessive student loan debt

As student loan debt rises, colleges and universities face more public scrutiny over costs and more pressure to help students graduate with less debt.

In a recent article for Investopedia, Fred Amrein, a college funding expert, recommends several strategies students can use to graduate with less debt. We noticed that administrators can support students with many of these debt-minimizing strategies.

Based on Amrein's article and EAB research, here are six ways administrators can help students navigate college finances and avoid excessive student loan debt.

1: Encourage students to take 15 hours of coursework

Students who only take 12 credits per semester are less likely to graduate on time and incur greater debt, Amrein writes. Administrators should encourage students to take 15 credits a semester to help them graduate on time.

According to EAB's Student Success Collaborative, students who average 15+ credits across their first year end the year with higher GPAs and higher retention rates than their full-time peers with similar levels of high school academic achievement who take fewer credits. The study also found that students from varying academic achievement levels or from a low-income background all benefited from taking a 15-credit semester.

2: Guide students through course schedule planning

Students who are left to decipher course offerings alone may mis-time their course selection and delay their progress to graduation, Amrein writes.

In fact, scheduling is one of the largest navigational challenges facing community college students, according to research from EAB's Community College Executive Forum. Administrators can help tackle this persistence barrier by guaranteeing consistent course schedules and redesigning curriculum maps that emphasize internships.

Read more: 5 steps to building a co-curricular major map

3: Educate students on college costs

College finances are difficult to understand for both prospective students and their families, Amrein writes. And for many students, the financial surprises that arise during the admissions process can play a role in their enrollment decisions, writes Peter Farrell, a managing director at EAB's Enrollment Services.

To minimize these financial surprise, more institutions are educating prospective students on college costs, early and consistently, throughout the admission cycle, Farrell writes. Robert Morris University, for example, developed and launched a College Affordability Academy® to provide front line staff, like admissions counselors and financial aid officers, with data about resources and key finance topics so they could include this information into their interactions with students.

4: Invest in students' financial literacy

Many students and recent graduates struggle to understand their loan repayment or financial aid options, Amrein writes. But financial literacy courses can help students prepare for the financial challenges of life after college.

The California Community Colleges (CCC) system, for example, is implementing educational programming across each of its 114 colleges that includes a crash course in financial literacy. Administrators hope that the program will equip students with the knowledge they need to "save, invest, stay out of debt and have more money saved for retirement," according to the website for CCC's chancellor. 

Related: What TurboTax can teach us about nudging students to finish FAFSA

5: Prepare students for the workforce

Students are more concerned than ever about how their choice of undergraduate major will affect their salary. In fact, almost three-quarters of today's first-year students consider making more money as a very important reason to attend college and more than 80% hope to be financially well-off after graduation.

Colleges and universities are taking steps to improve career outcomes by helping students articulate the value of their experiences to prospective employers. And as more employers like IBM and Cisco demand T-shaped professionals, many institutions are redesigning curriculum maps to help students develop the soft and hard skills necessary to succeed in the labor market. 

6: Encourage students to take summer courses

Taking an extra course—or two—over summer break could allow students to graduate faster and minimize their debt, Amrein writes. Summer sessions also provide a solution for students hoping to graduate on time, but may not have room in their schedule during the academic year to retake a failed course or a specific major requirement (Amrein, Investopedia, 1/16).

Also see: Transform an early course withdrawal into a timely catch-up opportunity


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