Graduate and professional students face a new financial reality with the elimination of the Federal Grad PLUS Loan. Without it, the path to paying for graduate school requires more planning and a careful balance of attainable, sustainable, and adaptable funding strategies.
Before signing any loan agreement, take time to walk through this checklist so your graduate funding options align with your goals—not just for school, but for life after graduation.
The best loan decision starts long before you borrow—preparation turns debt into an investment instead of a burden.
1. Minimize Your Borrowing
- Complete all scholarship and fellowship applications. Free aid is always the most attainable funding source. Cast a wide net—apply to national, institutional, and local awards. Great places to start include Fastweb, Peterson’s, and your school’s financial aid office.
- Consider employment to offset costs. Graduate assistantships, part-time teaching, or research positions can reduce tuition while adding valuable experience. For ideas on finding assistantships, check out GradSchools.com.
- Use your savings wisely. Be sustainable—leave yourself a financial buffer for emergencies. Consider CFPB’s guidance on emergency funds.
2. Understand Your Loan Options
Graduate student loans are not one-size-fits-all. A thoughtful mix may be the most adaptable path forward.
- Prioritize affordable loans first. Begin with Federal Direct Unsubsidized Loans, which have set annual and lifetime borrowing limits.
- Understand your federal loan limits. Graduate and professional students can borrow up to $20,500 annually(and up to $50,000 annually for certain professional programs starting July 1, 2026).
- Compare private student loans. When evaluating loan programs, compare interest rates, fees, repayment flexibility, borrower protections, and total long-term costs to ensure the funding choice is both affordable and sustainable.
- If you own a home, evaluate home equity. A home equity loan may offer lower rates but comes with risk.
- Know your credit score. Get your free report from AnnualCreditReport.com (official site). When reviewing your credit report, check for accuracy in your personal information, payment history, open accounts, credit inquiries, and any errors or red flags that could affect your loan eligibility. Check out the CFPB’s credit report errors list.
- Check your Debt-to-Income (DTI) ratio. Use Calculator.net’s DTI Ratio Calculator to assess affordability.
- Understand interest rate structures. Understand the differences in repayment when choosing a fixed versus variable interest rate.If you select a deferred repayment option, be clear on when interest will accrue and how often it will be capitalized. If you consider safety-net options such as income-based repayment or an income-share agreement, weigh the trade-offs carefully—including potential impacts on your interest rate, future taxes, and the risk of overpayments.
- Determine if you need a cosigner. A student borrower may need a cosigner if they have limited credit history, a low credit score, or insufficient income to qualify on their own. A creditworthy cosigner can improve approval odds and secure better loan terms, but they also share legal responsibility for repayment. Carefully consider this option, since it can affect both the borrower’s and the cosigner’s financial future.
3. Understand Your Ability to Repay
Borrowing is only sustainable if repayment is realistic.
- Research starting salaries. Use the U.S. Department of Labor’s Occupational Outlook Handbook to estimate post-graduation income.
- Calculate your monthly repayment. Model payments for different loan amounts using the Federal Student Loan Simulator.
- Consider repayment length. Many lenders offer terms from 5 to 25 years. Shorter repayment terms typically mean higher monthly payments but lower total interest costs, while longer terms reduce monthly payments but increase the overall price of the loan—making it important to weigh affordability against long-term expense.
- Organize your loan research. Track your options—Federal Unsubsidized Loan, private graduate student loans, employer tuition assistance, scholarships, and more—in one place.
Bottom Line
A graduate degree can be attainable, sustainable, and adaptable—if you plan before you borrow. By minimizing debt, understanding your options, and preparing for repayment, you can finance your education in a way that protects your future financial freedom.
Decision-Making & Tradeoffs Survey
fter walking through this checklist, share your perspective in our Decision-Making & Tradeoffs Survey. Your input helps us understand how graduate and professional students are planning for life after Federal Grad PLUS. Results will be shared back with the community in clear charts and summaries.
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