Student loan consolidation is a repayment tool that bundles all your school loans into one loan. So instead of having to pay off two or three loans to different loan providers you can lump them and pay back one provider. For example, you can put your Stafford, PLUS loans, and your federal perkins loans into one single debt.

But is it worth it?

Well, with a student loan consolidation you get reduced monthly payments.

Unlike the other loans, consolidation loans have a fixed interest rate for the life of the loan. The fixed  interest rate is calculated as the weighted average of the interest rates of the loans being consolidated and capped at 8.25%.

But consolidation loans have longer terms than other loans and you can choose to pay your loan back over 10 to 30 years. (If we do the math that means, you may still be paying off your college education when you’re in the 50s. And by then you are bound to have a mortgage too!)

Although the monthly repayments are lower, the total amount paid over the term of the loan is higher than what you would pay with other loans.

Some features of the original consolidated loans, such as postgraduation grace periods and special forgiveness circumstances, are not carried over into the consolidation loan and you have to consolidate during your grace period to avoid an interest rate increase of 0.60%. If you wait until your grace period ends, your interest rate will automatically be 0.60% higher.

So you have to figure out if loan consolidation works for your needs. If you want to pay less each month but extend payments over a longer period of time then, go for it. If you don’t want to pay more in the long run and have debt hanging over your head for decades, then the student loan consolidation program might not be the way to go.

Either way, it looks like there’s a price to pay for a good college education.

So it’s frosh week on campus and you are being offered everything from free t-shirts and baseball caps to student credit cards.

Do you take all the free merchandise that you can get your hands on?

And what about those student credit cards? Are they really free or do they come with a big invisible price tag.

On the one hand, there are many benefits to getting a student credit card. With them you can start building your credit, learn how to manage and budget your money and buy big ticket items that you need for college.

There are also small perks: you can easily book plane and train tickets to get home to visit your family or collect affinity points to get free stuff.

And it is always good to have a credit card in case of emergencies.

But there are serious disadvantages and possible consequences to charging it.

With its shiny plastic finish, credit cards don’t resemble cold, hard cash and you might be tempted to spend money that you don’t really have.

It’s easy to buy that new pair of kicks you’ve been eyeing, when you don’t have to fork over the cash up front. But big ticket items can really add up if you’re not careful and before you know it you might not be able to pay off your monthly credit card bill.

Even if you pay the minimum, you’ll have to pay serious interest when the year’s up. And if you don’t have the cash to pay it back at all, you can end up having bad credit. That could ruin you for life—you won’t be able to get loans for cars or loans to buy a house. They even check credit when you’re getting a cell phone and if yours is poor you may have to put a down payment of $500.

Learning how to manage money is a definite part of growing up. And like anything new that you are learning, you are definitely bound to make mistakes along the way.

But misusing your student credit card is a high price to pay. So if you are going to get a student credit card, remember nothing really comes free in life.

 According to market research on student spending, you guys are spending more money than any generation before you. Students have become serious consumers and that means you can rack up a serious debt when you’re at college.

These are some of your spending trends.

Students are more into designer brands than ever before. The expenses of students on clothes and accessories have spiralled out of control. It seems like college is no longer about basic 5 dollar t-shirts and jeans. It’s still about T-shirts and jeans, just now it’s Ed Hardy Ts and True religions.

Students also spend more money on big ticket electronic items and entertainment. Laptops are a staple in students lives..and you are willing to pay for the latest models with the fanciest features. Cellphones with mp3 players and iphones are becoming status symbols.

Students don’t seem to be spending more on food than their parent’s generation. But they are spending more on drinks. Alcoholic ones. The party scene has been glamorized in the media and students are buying into it.

To pay for these toys, students are being targeted by financing companies including student loan providers, consolidators and credit card companies. Students have been racking in a huge debt even before they graduate college.

But students are also more aware of financial matters than ever before. Students take insurances early are more interested in investing options on and spend on career building supplementary courses.

So the market research on student spending shows that on the one hand, students are into spending and on the other hand, students are into saving. But handling all this money requires know how. So tomorrow we’ll talk about whether whether student credit cards will build future credit or just get you into debt.