According to the U.S. Department of Education’s latest data, only 52% of veterans used their GI Bill benefits to fully fund their post-secondary education. Using that same data in a Pew analysis, 27% of independent* undergraduate veterans took out student loans averaging $8,000 – or $500 higher than student loans taken out by independent non-veteran students which averaged $7,500. So why do veterans take out student loans?

Reasons for Student Loans

A couple of reason are obvious. Everyone has a different set of life circumstances that can lead to the decision to take out a student loan.

1. Entitlement is Exhausted

One, the student may have already exhausted their entitlement, but have not yet finished their degree. Many students start in one degree program and then part way through, change to an entirely different program. Usually not all of the past credits acquired will transfer to the new degree plan – whether in the same school or a different school. If those credits not transferable were paid for through GI Bill entitlement, that entitlement was wasted.

Veterans with at least three years of service are eligible for the Post 9/11 GI Bill and are authorized 36 months of entitlement which is enough for four 9-month academic years and an undergraduate degree. But that entitlement must be managed properly for the GI Bill to pay for the whole degree.

Veterans with less than three years of service still have 36 months of entitlement, but at a lesser percentage of coverage. They must either self-fund the difference out-of-pocket, use scholarships or grants, or take out student loans.

2. Undergrad Done and Now on to Graduate

The student may have used their GI Bill benefits for an undergraduate degree and do not have enough left to fund their graduate degree. Or they may decide to take out a student loan to pay for the first two years of their undergraduate degree and save their GI Bill entitlement to pay for the last two years of undergraduate school and the fund the more expensive two years of graduate school.

3. Private or Foreign School

Or they may be attending a private or foreign school in which the Post 9/11 GI Bill only pays $26,042.81 per year. For many schools, this is only half or less of the total bill of which the difference left to pay is the responsibility of the student. Many veteran students end up taking out  student loans to pay the difference.

4. Transferred Benefits

Another common reason is that the student does not have any entitlement left, or not enough for their degree, due to a transfer of benefits made while serving. Some servicemembers at the time have no intention of using their education benefits, so they transfer them to their spouse or dependent children. But once out, things change and they decide to go to school, but do not have entitlement left to use.

5. Bad Discharge

Another reason that has gained more attention lately are veterans that have a “bad discharge”. This prevents them from using their GI Bill education benefits.

Squeeze Every Dime out of Your Entitlement

If used properly, the Post 9/11 GI Bill pays schools up to 100% of in-state tuition and fees at public schools. Veteran students with Post 9/11 GI Bill benefits get a monthly housing allowance based on the zip code of the school; the national average is $1,900 per month. On top of that, they also get up to $1,000 per year in book stipend money.


*Note that an independent student is defined as one that is generally an adult and is twice as likely to have dependents of their own verses general population students which are usually single and have no dependents.


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Kness retired in November 2007 as a Senior Noncommissioned Officer after serving 36 years of service with the Minnesota Army National Guard of which 32 of those years were in a full-time status along with being a traditional guardsman. Kness takes pride in being able to still help veterans, military members, and families as they struggle through veteran and dependent education issues.