Creative Ways to Pay Down Your Student Loans
Maximize other people's money to pay down student debt
So you have graduated college, started a new job, and settled into your new accommodations, but now here comes your first student loan repayment. It’s time to consider if there are a few ways to use someone else’s money to pay down some of that debt.
Ask your employer
What do employers like Honeywell, Penguin Random House, Staples, and Aetna have in common? They all offer student loan repayment assistance. Why are they doing it? According to PwC’s 2018 Employee Financial Wellness Survey, 81% of Millennial employees say that their student loans have a moderate or significant impact on their ability to meet their other financial goals. Understanding that employees free out of college are challenged with student debt, employers want to cut the stress that can affect work performance to help their employees.
How do you know if your employer or potential employer provides student loan repayment assistance? Just ask. Most often this is not the first on the list of employee benefits that they communicate, so be certain to talk to the benefits expert in the human resources or talent management team.
Work for Qualifying Employer to Benefit Society
If you have federal student loans and work at least 30 hours per week for a government organization at any level, a tax-exempt 501(c)(3) not-for-profit organization, or not-for-profit organization that provides qualifying public service, you may be eligible for the Public Service Loan Forgiveness program. This option takes some time to benefit from - in fact it takes 10 years and a lot of paperwork. The good news is it could mean that the feds forgives the remaining balance on your federal student loans after 120 qualifying payments.
Teach kids in need
Be teaching at an eligible for 5 consecutive years, you may be eligible for loan forgiveness of up to $17,500 of your federal student loans in the Teacher Loan Forgiveness Program. The key is to be a full state certified teacher at an elementary school, secondary school, or educational service agency that is listed on the Annual Directory of Designated Low-Income Schools for Teacher Cancellation Benefits (Low-Income School Directory), published by the US Department of Education. Remember emergency, temporary, or provisional basis don’t qualify.
Be a doctor in medically underserved area
Did you know that doctors serving the physical and mental health of American Indians and Alaska Natives or communities in rural and frontier areas and clinical or pediatric Researchers working for the National Institutes of Health (NIH) can get help paying off their student debt? The Indian Health Service (IHS), the NIH, the National Health Service Corps, the U.S. Department of Health and Human Services (HRSA) offer student loan repayment assistance. In fact, some states also have similar student loan repayment programs for doctors, pharmacists,and researchers . For the most comprehensive list of state and federal loan repayment programs for doctors, check out the Association of American Medical Colleges list.
Play a trivia game
A crowdfunded mobile app called Givling helps student loan borrowers working as teams play trivia with the possibility of winning money to pay down up to $50,000 of student debt. In fact, borrowers can ask friends and family to play the trivia game to help contribute to their student debt pay down. Be aware that the average user spends $4 a month, although many users have never paid to play.
Colleen MacDonald Krumwiede is a financial aid and paying for college expert with over a decade of financial aid experience at Stanford GSB, Caltech, and Pomona College and another decade at educational finance and technology companies servicing higher education. She guides go-to-market strategy and product development at Quatromoney to transform the way families afford college.