When students decide to go to school, one of the last things on their mind is considering how they’re going to pay for college over the next few years. Here are the differences between student loans and grants and the benefits and negatives of each one.

One of the first things you need to consider is how much money it is going to cost to go to college. You need this as a determining factor when considering whether or not to take out a student loan or to apply for grants.

Student loans are taken out usually as an easy source of funding to pay for college education. I recently took out tens of thousands of dollars to cover the money that I needed to earn for a master’s degree. If I could go back and do it again, I might not have made this choice.

Grants are better way to go because this is money that you do not have to repay. It is like getting a windfall check in the mail to pay your bills and not using your credit card because that’s all you have to use. One of the benefits for student loans is that the application process begins on line with the FAFSA and typically ends with you signing several papers called promissory notes which you don’t have to worry about until you have earned your degree.

If you decide to go the free money route, the best way to go is with the teach grants or the Pell Grant which is limited to about $5000 each semester but will provide you with enough money to pay for your first couple years of college.

Too many people take out both grants and student loans without realizing that it is a bad decision to make if they really didn’t need the money. They may spend it frivolously and at the end of it all realize it should have gotten another source of income instead of making a choice to accrue future debt.

At the end of the day, or at the end of your college career, you will realize whether or not you made a good choice or not regarding your funding. If you land the job that you’ve always wanted and can pay off your debts, if you have any, then you probably made the best choice.