Like many student-loan issuers, Sallie Mae encourages potential borrowers to calculate monthly expenses before taking out loans. By taking only the loan amount that you will need, you reduce the overall amount that will eventually require repayment with interest. Sallie Mae provides several online calculators for potential borrowers to experiment with possible budgets before choosing an appropriate amount to borrow for college costs. Double-check your calculations against other online calculators to arrive at a figure that seems reasonable for your situation.
Instructions
1. Gather your monthly bills and financial documents, including paycheck stubs, bank statements, investment reports, credit card bills, utility bills and insurance premiums. Having all current bills in hand will help you make accurate calculations.
2. Enter your income into a Sallie Mae online calculator or other reliable budget calculator. This figure includes take-home pay and other after-tax income, such as dividends or investment earnings.
3. Enter your educational expenses, including tuition, student fees, textbooks and student loan payments. Because some of these are paid in periodic lump sums rather than in monthly payments -- tuition, for example, is paid at the beginning of the semester -- divide your annual total by 12 to obtain an accurate monthly figure.
4. Enter other expenses. Housing expenses include rent, utilities and telephone bills. Clothing, toiletries and laundry costs are examples of living expenses. Food costs include grocery bills, restaurant expenses and the cost of beverages. Transportation costs might include car payments, gas, auto insurance, subway fares and parking fees. Entertainment expenses might include movies and satellite TV. Do not forget miscellaneous expenses, such as health insurance, medical expenses, loan payments and membership dues.
5. Note your monthly expenses and calculate the funds you will have available without taking Sallie Mae loans into consideration. If there is a gap between monthly expenses and the funds you have available from salary and other income, taking out student loans might be a reasonable option. The difference between available funds and monthly expenses is a good indicator of projected loan amounts from Sallie Mae.
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