Student loans and scholarships are probably the biggest problem to be surmounted, as far as the entire 'planning to go to college' part is concerned. There are tons of options and decisions to be made regarding financial aid, and the wrong choice can pull the rug out from under a young person's life. Consider these choices and tips carefully before making any decision.

Student loans and scholarships are probably the biggest problem to be surmounted, as far as the entire 'planning to go to college' part is concerned. There are tons of options and decisions to be made regarding financial aid, and the wrong choice can pull the rug out from under a young person's life. Consider these choices and tips carefully before making any decision.

The first thing to do is apply for federal aid and simultaneously choose a private lender. That's because the cost of a good education has gone up so fast that most people will need both. The federal aid comes in the form of a fixed rate loan, for which the applicant or parent of a dependent child has to apply via FAFSA.

It will be either a Stafford, PLUS or GradPLUS loan, depending on what it is required for and who is signing for it. The application is not complicated and a simple three step online application process will provide a FAFSA PIN number. This number can then be used to track the application and change personal details.

When applying for federal aid, always apply for the max amount possible and required, so that the balance from a private lender won't be a burden. A private lender will offer a consumer loan for educational purposes, with a variable rate. The lender will take into consideration the applicant's credit worthiness.

This is difficult for a young applicant, who can't be expected to have a solid credit history or show proof of income. Private lenders, therefore, require the proposal to have a co-signer. Both the applicant and co-signer should study the terms carefully to make sure it won't saddle them with too much debt.

It's best to do some comparison shopping and check out offers from many lenders. Look for favorable offers in terms of a flexible amount and repayment period, low APR, interest rate and fees. The sum of it is that when applying for student loans, first consider and exhaust all options for scholarships and federal aid, and then fill in the balance with a private lender.