Student loans are often necessary to fund your degree, but you may be restricted in how much you can borrow. It’s important to research student loan limits before you borrow so you can make an informed plan and cover all of your costs.
Most federal student loans have annual and lifetime limits, while many private student loan lenders allow you to borrow up to th𓃲e cost of attendance. See how much you can borrow with each type of student loan and what amount♔ you can safely repay.
Federal student loan limits
Federal student loan limits depend on the kind of loan you borrow, as well as your year in school and whether you’re a♍ dependent or independent student.
When you submit your Free Application for Federal Student Aid (FAFSA), you’ll input info that determines your status as an independent or dependent. All graduate or professional students are considered independent. Most undergrads ar💫e considered dependent, unless they are:
- Age 24 or older
- Married
- Supporting their own dependent children
- Serving in the military
- An emancipated minor
- Meet other specific requirements outlined by the
The table below shows the annual and lifetime limits for Direct Subsidized and Unsubsidized Loans.
| Year | Dependent student | Independent student* |
|---|---|---|
| 1st year undergrad | $5,500 annually (up to $3,500 can be subsidized) | $9,500 annually (up to $3,500 can be subsidized) |
| 2nd year undergrad | $6,500 annually (up to $4,500 can be subsidized) | $10,500 annually (up to $4,500 can be subsidized) |
| 3rd+ year undergrad | $7,500 annually (up to $5,500 can be subsidized) | $12,500 annually (up to $5,500 can be subsidized) |
| Graduate or professional student | N/A | $20,500 annually |
| Lifetime limit | $31,000 (up to $23,000 can be subsidized) | $57,500 for undergrads (up to $23,000 can be subsidized) $138,500 for graduate or professional students, including undergrad loans (up to $65,500 can be subsidized) |
Direct PLUS Loans are available to graduate students and parents of dependent u💖ndergraduates, as long as the borrower doesn’t have adverse credit. The maximum loan amount is the school-certified cost of attendance, minus any other financial aid available.
Related: Federal student loans: 2023 guide
Private student loan limits
Private student loan limits can be more difficult to determine because they vary by lenꦇder and the degree program you’re enrolled in.
With many private lenders, you can borrow up to the school-certified cost of attendance annu🌱ally, minus any other sources of financial aid you receive. Lifetime limits can vary depending on both the lender and the type of degree you’re earning.
Degrees that are more expensive (and typi✤cally come with higher salaries) may have higher limits. For example, if you borrow from Citizens, you would be subject to the following lifetime limits:
- $150,000 for undergraduate and graduate degrees
- $225,000 for MBA and law degrees
- $180,000 to $350,000 for different health care degrees
Other lenders may have lowe⛄r aggregate limits, or even annual limits. Most l🔴enders also have minimum borrowing requirements. For example, you might not be allowed to borrow less than $1,000 or $5,000, depending on the lender.
Related: Graduate school loan limits, and how to minimize debt
How much can I safely borrow?
Deciding how much to borrow can be complicated, as you may not need as much as lenders offer you. Remember, every dollar you borrow has to be paid back with interest, so taking on unnecessary deb🅺t will affect your future finances.
A good rule of thumb is to keep youꦍr total student loan balance equal to or below your estimated starting salary after leaving school. This can help ensure that your loan payments are affordable once you start repaying your debt.
It’s also wise to bor🎀row the minimum amount needed to cover your tuition and pay for reasonable costs of living. Using loan money for unnecessary purchases such as travel, concert tickets, or luxury items could leave you struggling to become debt-free later in life.
To help decide how much you can — and should -— borrow, use the to estimate your future earning capacity and the financial aid section of your school’s website to review the estimated cost of attendance.
How to reduce what you owe in student loans
To make debt payback easier later, take steps to reduce the amount you borꦆrow now. These steps can include:
- Choosing an affordable school: Consider state schools, public institutions, or community colleges to keep costs down, or look into schools that promise generous financial aid packages. If a school has a much higher price tag, find out if it’s justified by doing your research — including reviewing the starting salary of the school’s graduates.
- Applying for scholarships and grants: Your school may offer grants or scholarships which don’t have to pay back. You can also search for scholarships through your state, private organizations, or community groups.
- Working while in school: Earning a paycheck can help you borrow less for your living expenses. Or you could use the money to start paying interest only on your current loans to minimize costs. Many schools offer work-study programs that make it easier to work while earning your degree.
- Cutting costs: If you can reduce the cost of living while in school, you can borrow less. You might live at home or with roommates, set a reasonable budget, or look for opportunities to save by using coupons and limiting your spending on entertainment or clothing.
- Returning unused money: If you don’t need all your student aid, send it back to the lender. In some cases, you may not even owe interest on the amount if you return it soon enough. Check with your lender to determine the best way to give back extra cash.
By taking these steps, you can keep your borrowing well below the maximum you’re allowed -— and set yourself up for more financial security later. Remember, you don’t have to borrow the maximum student loan limits, and should aim to borrow less whenever possible.