Here's a breakdown:
* "Aloud" is an adverb meaning "in a voice that can be heard."
* Example: "The teacher read the story aloud."
* "Out loud" is a phrase that also means "in a voice that can be heard."
* Example: "She thought the answer to herself but didn't say it out loud."
While both are correct, "aloud" is often favored in writing because it's a single word and has a more formal tone. "Out loud" is more common in informal speech.
However, there's no hard rule, and you can choose whichever phrase feels more natural to you.