Taking a Break From College? Here’s What You Need To Know

Getting a college education can sometimes be interrupted by things like financial hardships or family emergencies. There's no shame in taking a break from school, but students and their families should understand how leaving college could affect their financial aid and education.

If you're considering taking time away from your college education, here's what you need to know to protect your academic success and your finances.

Why take a break from college?

Students take time off from college for different reasons, but some challenges are more common than others. According to Sallie Mae's How America Completes College 2024 report, the top reasons students consider a break include financial strain, loss of motivation, and mental health challenges. Academic struggles, social difficulties, and physical health issues are also common factors.

Some students take a short break with plans to return the next semester or academic year, while others step away indefinitely. The decision to return to the same school or transfer elsewhere can also affect how long a break lasts.

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How taking a break affects financial aid

Taking time off from college can impact your financial aid, as federal aid eligibility assumes continuous enrollment.

“You're no longer eligible for federal financial aid if you drop below half-time enrollment,” says Dr. Darla Bishop, author of “How To Afford College.”

“And if your break lasts longer than six months, you will have to begin repayment on any federal student loans,” she adds.

If you return to school after a leave of absence, your student loans will go back to “in-school deferment” status. However, taking a break can still affect your repayment timeline.

“If you take a leave of absence for a full year or even just a semester, the grace period will be exhausted by the end of the leave of absence, so you will not have a grace period when you ultimately graduate,” says Mark Kantrowitz, author of “How To Appeal for More College Financial Aid.”

Loans aren't the only type of aid affected by a break in enrollment. Scholarships and grants may also be at risk.

“Students who leave at the end of a semester or academic year can just decline grants or scholarships for the upcoming semester,” Bishop says. “But the rules get wonky if you leave in the middle of a semester.”

If you leave mid-semester, you may be required to repay grant and scholarship funds that were tied to your academic performance, such as maintaining a certain GPA. But there are ways to avoid this.

“Try to stay until the end of the semester, or negotiate for incompletes for the term, which gives you several weeks into the next semester to complete the coursework,” advises Bishop.

How to take a break from college

Taking a leave of absence requires certain paperwork, even in an emergency. You'll need to understand your school's leave of absence policy and notify your school of the upcoming break.

“There's a lot of timeliness for certain types of notification,” says Bishop. “If you have to leave suddenly, you may miss a deadline, which could affect your ability to get future financial aid.”

If you're considering a leave of absence, Bishop recommends taking the following steps to prepare:

1. Meet with your academic adviser: Your adviser can walk you through your school's leave of absence policies and help you complete any required paperwork.
2. Check with the Office of Student Affairs: This may also be called the Office of Student Services. This department can guide you through the re-enrollment process and help ensure you remain eligible for financial aid when you return.
3. Talk to the financial aid office: A leave of absence can impact your student loans, grants, and scholarships. The financial aid office can explain how your break will affect your aid and what steps you need to take.
4. Plan for health care and housing: If your school provides your health insurance or housing, you'll need a plan to cover these expenses while you're on leave.

Managing student loans during a college break

Taking a break from college can affect your student loans. Federal student loans have a six-month grace period that starts when you graduate, leave school, or drop below half-time enrollment. If your break lasts longer than six months, your loan payments will begin.

For students stepping away due to financial or mental health concerns, making payments right away may not be realistic. Fortunately, there are options to keep your loans in good standing without adding financial strain.

“Depending on your circumstances, you can ask the lender to put your loans into a deferment or forbearance,” says Kantrowitz. “Options include economic hardship deferment, unemployment deferment, cancer deferment, or general forbearance.”

Another option is enrolling in an income-driven repayment (IDR) plan for federal student loans. “An income-driven repayment plan may also be an option, since your loan payment may be zero or very low if your income is below or near 150% of the poverty line,” adds Kantrowitz.

Even if you qualify for deferment or forbearance, making small payments can help keep your loan balance from growing. “It's more likely than not that interest is accruing during your leave of absence,” says Bishop. “Compound interest is amazing in retirement accounts but soul-crushing on a student loan balance.”

If possible, consider making interest-only payments while you're on break to prevent your loan balance from growing.

Learn More: Interest Accrual on Student Loans: When It Starts and How To Manage It

Tips for returning to college after a break

Re-enrolling after a break can be simple or complicated, depending on how long you've been away. Before you leave, ask the Office of Student Affairs for details on the re-enrollment process, including deadlines and any required paperwork.

You may also need to submit a new Free Application for Federal Student Aid (FAFSA) when you return, since federal financial aid is awarded on a yearly basis.

“Your financial aid is based on income during the second previous tax year. So, if you worked during the leave of absence, it may affect your aid eligibility the year after you return to school,” warns Kantrowitz.

It's also a good idea to stay academically engaged while you're away. Check with your adviser or the Office of Student Affairs for ways to keep your skills sharp and ensure a smooth transition back to college.