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Tata Capital > Blog > Loan for Education > How To Use Student Loans For Living Expenses

Loan for Education

How To Use Student Loans For Living Expenses

How To Use Student Loans For Living Expenses

Student loans are a valuable resource for individuals pursuing higher education. They provide financial assistance to cover not only tuition fees but also the cost of living while in college. But does an education loan cover living expenses? Many students rely on education loans to pay for necessities such as rent, transportation, meals, and other day-to-day expenses. In this article, we will explore how student loans can be used for living expenses and provide some tips on managing these funds responsibly.

Can You Use Student Loans for Living Expenses?

If you live on campus, your student loans can help cover living expenses up to your school's cost of attendance (COA). The COA is an estimate of the total cost of attending college, including tuition fees, textbooks, accommodation, and other related expenses. In this section, we will find out what is included in education loans. Whether you live on-campus or off-campus, you can use your student loan funds to pay for various living expenses such as:

1. Rent: Your monthly rental expenses can be covered by student loans.

2. Transportation: This includes gas expenses, parking fees, public transportation costs, and more.

3. Meals and Groceries: Your food expenses can be managed using your loan funds.

4. Housing Utilities and Supplies: Paying for utilities like electricity, and water bills or purchasing household supplies is permitted.

5. Home Furnishings: Buying furniture or any other necessary items for your accommodation can be funded through student loans.

It is important to note that after the student loan amount is applied towards paying off your college dues, any remaining balance will be returned to you directly. These funds can then be used towards covering the aforementioned living expenses as well as other educational needs like textbooks, supplies, and computer equipment required for your studies.

However, it is essential to remember that the money borrowed through student loans is not free; it accrues interest over time. It is advisable to use these funds responsibly by sticking to essential needs rather than indulging in wants, and keeping track of your expenses using a budget.

Understanding Cost of Attendance

The cost of attendance (COA) is the estimated cumulative cost associated with attending college. It includes tuition fees, textbooks, accommodation, meals, transportation, and other necessary expenses. The COA varies from one college to another and is adjusted based on the cost of living loans for students in the area where the college is located.

Your school's COA determines the maximum amount you can borrow through student loans. It serves as a guideline to help students understand the total cost they will incur while pursuing their education.

How to Make Responsible Use of Student Loan Funds

While student loans for living expenses can be a lifeline for managing living expenses during college, it is crucial to use these funds responsibly. Here are some tips to help you make the most of your education loan:

1. Cover Must-Have Needs First: Prioritise essential expenses such as tuition fees, major living arrangements, and other significant costs when allocating your student loan funds.

2. Look for Less Expensive Alternatives: Consider affordable options when purchasing supplies or other items for school. Look for second-hand options, or consider sharing costs with friends.

3. Crunch the Numbers on Housing Options: Evaluate different housing options that align with your budget. Living off-campus without an expensive meal plan could potentially save you money.

4. Spend Only What You Need: Just because you have been approved for a large loan amount doesn't mean you have to spend it all. Be mindful of interest charges on any additional amounts used for living expenses.

By being responsible and prudent with your student loan funds, you can prevent unnecessary debt accumulation and set yourself up for better financial stability after graduation. You can thus start living off student loans without much financial crisis.

Tips for Saving Money on Living Expenses

Here are some tips to help you reduce your living expenses during your college years:

1. Create a Budget: Track your income and expenses using a budgeting tool or app. This will help you identify areas where you can cut back on unnecessary spending.

2. Cook at Home: Preparing meals at home is generally more cost-effective than eating out or ordering take out regularly.

3. Utilise Student Discounts: Many businesses offer discounts specifically for students. Be sure to take advantage of these discounts when shopping or accessing services.

4. Share Expenses with Roommates: If you live off-campus with roommates, consider splitting the cost of rent, utilities, and groceries. This can significantly reduce your individual expenses.

5. Opt for Public Transportation: Depending on your location, using public transportation instead of owning a car can save you money on fuel, parking fees, and maintenance costs.

These strategies can help you effectively manage your living expenses and reduce the reliance on additional student loans.


Student loans provide essential financial support to cover not only tuition fees but also the cost of living while pursuing higher education. By utilising student loan funds wisely, students can manage their living expenses without excessive financial burden. However, it is crucial to use these funds responsibly and prioritise essential needs over wants.

Remember to create a budget and track your expenses to ensure you are making the most of your student loan funds. Tata Capital offers various loan options to meet the diverse financial needs of individuals. Whether it's a personal loan or a home loan, Tata Capital provides professional and trustworthy services with a commitment to enabling growth and financial empowerment.

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