From scholarships to grants to loans, you have plenty of options when it comes to paying for college costs, including tuition, room and board, books, equipment, and school supplies. While scholarships and grants are free money and don’t need to be repaid, when it comes to student loans, you’ll want to keep your post-college debt to a minimum and borrow wisely.

Before deciding that student loans are the right source of financing for you, ask yourself: “How much in student loans will I need?” and “What can my student loans cover?”

How Much in Student Loans Will I Need?

After exploring scholarships and grants, a Sallie Mae Smart Option Student Loan may be a good option to help meet the cost of college. You should first apply for federal student aid, including federal student loans, by completing the Free Application for Federal Student Aid. The FAFSA — the key to unlocking financial aid for college — gathers information about income, assets, and family demographics in order to calculate your family’s expected contribution to college expenses and determine your eligibility for federal student aid.

To determine how much in student loans you need — or even whether you need loans — apply a simple mathematical formula:

• First, estimate the actual amount you’ll pay to attend one year of college. Include tuition, housing, food, school supplies, cell phone use, furnishings for your dorm room, transportation, and equipment like a computer and a printer.
• Subtract any scholarships or grant money you’ve received.
• Subtract any money you plan to put toward your education from a summer job or personal savings. If your family plans to contribute funds, factor those in as well.

If you come up short, a student loan could help fill in the gap between family resources, grants, student aid and scholarships, and the cost of a college education. Just remember to borrow wisely, only taking on the amount you need, because you’ll have to pay back those loans.

“Sallie Mae recommends a 1-2-3 approach to paying for college,” says Karie Bedford, Client Relationship Manager with Sallie Mae®. “First, start with money you won’t have to repay by maximizing scholarships and grants. Second, explore federal student loans by completing the Free Application for Federal Student Aid. And third, consider a responsible private education loan to fill the financing gap.”

Use the Regions “Save for College” calculator to compare your planned savings to the amount that will probably be necessary.

What Can My Student Loans Cover?

Typically, student loans can help cover tuition and other eligible school expenses, but it’s important to understand the cost of college and borrow what you need to fund your education —not necessarily a lifestyle, Barnes says.

Carefully review your award letter. In some cases, the federal student loan amount offered to you through your college’s financial aid office might exceed the amount of money you need to cover your expenses. But just because you can receive excess loan money doesn’t mean you should. You’re not obligated to accept the entire loan offered and can request a lower amount.

Follow the budget you set out in the beginning of your college journey, and explore other options such as work-study programs to reduce the amount you have to borrow. Making payments while in school can also save you money over the life of the loan, Barnes says. Paying for college is just like any serious investment. If you plan early, make informed decisions, and keep your eyes on the prize, you can make a successful investment in your future.

Sallie Mae’s College Planning Toolbox includes various tools and resources to help you stay on track, plan and save effectively, and responsibly pay for college.