Imagine this: you graduate from your dream school, land your dream job, move into a posh new apartment with a nice view of the city, get your first ‘real’ paycheck, and buy that new suit you’ve had your eye on. Life is good.
Then this arrives in the mail: Your student loan account statement.
There are a lot of zeroes in the principal balance. Suddenly life as you know it has ceased to exist. The new suit gets returned, roommates are found to help with the rent, a second job must be found to increase your income, and sacrifices on your social life must be made. Your life is effectively put on hold for the next 10 years while you live like a pauper to pay off your student loan debt.
Unfortunately, this is a reality for millions of new college graduates. The reality of student loan debt is crippling the financial well-being of millions of millennials around the country.
Wouldn’t it be nice if you didn’t have to pay back your student loans? Wouldn’t it be nice to have part of your loan balance forgiven?
It’s possible! The Department of Education has a Public Service Loan Forgiveness program, where in exchange for working in an approved career field for 10 years, making 120 consecutive on-time monthly payments under the standard repayment plan, and following through with their rigorous application process, they will forgive the remainder of your balance after your 120 monthly payments.
This is helpful, but the vast majority of jobs that qualify for public service are not jobs millennials want. They are not in desirable job fields, they do not pay well, and they don’t have the potential for future increased income. That’s the catch. The loan forgiveness in the bait to entice recent college graduates into less than desirable career fields.
What if you don’t want to work in public service? Isn’t there another way?
While not a true loan forgiveness program sanctioned by the Department of Education, the following are 3 creative ways to effectively make your own student loan forgiveness program while working in the career field of your choice.
#1 – Work For A Company That Offers Loan Forgiveness
Corporate benefits are those intangible job perks that most everyone takes for granted (Unless of course you work for a start-up that offers catered meals, and then you get to enjoy very tangible benefits 3 times per day…).
Benefits like long term disability, life insurance and vision insurance don’t exactly make you feel more fulfilled on a daily basis. But one of the most overlooked and under-utilized corporate benefits that many companies offer is student loan forgiveness.
Some companies have offered this benefit for years, with very little participation and only recently has this become a much more attractive option for young millennials struggling with loan repayment.
At most companies, they require a vesting period, where you must work at the company for a certain period of time before qualifying for full or partial loan forgiveness. It might be that you earn up to $5,000 in loan forgiveness for every year of service with the company. Some may pay off your entire loan balance after 5 years with the company.
However the program is setup, this is one benefit that could make a job offer much more attractive than the competition. Some companies may even offer loan forgiveness as a sign-on bonus. Instead of cash up from, they might offer to pay your student loan payment for you for the next 2 years. Not a bad deal for someone just starting out!
When evaluating these job offers, be sure to contact HR at the companies and get the specific details on how these programs work.
#2 – Volunteer for Vista
Volunteerism has long been a way for recent college graduates to do some good in the world, figure out their life’s direction, and make some valuable connections. Volunteerism can also be an excellent way to earn some money towards repaying your student loans.
Volunteering through AmeriCorps VISTA program actually gives you a living stipend of $7,400 per 12 months and a payment of $4,725 which can be used towards paying down your student loan debt. This can be an excellent way to minimize your expenses, figure out the course of your life, and reduce your student loan burden.
Another benefit of the VISTA program is that you could even qualify for student loan deferment while volunteering. This may allow you to extend your 6 month student loan grace period, into an 18 month interest deferred period. This could allow you to pay down even more of the principal balance prior to repayment, and dramatically decrease the total cost of your loan.
#3 – Find a Corporate Sponsor
The final creative hack for getting student loans forgiven will take a bit more legwork. We all know that corporations around the world like to hang their brand on famous celebrities and people who are at the pinnacle of success. This is why Michael Phelps, Katie Ledecky, and Simone Biles all land major sponsor deals during the 2016 RIO Olympics.
They are in the public eye, and they are recognizable for their accomplishments. Companies want their brand to be associated with someone who can give them a positive association. You can apply this same marketing concept to your student loan forgiveness journey.
You could get a company to sponsor your student loan repayment journey. Here’s the pitch: You approach company X and say “Hi, my name is Johnny, and I owe $40,000 in student loan debt. I am starting a social media blitz to raise money to pay off my student loans. This will involve my posting to all social media outlets, writing on my blog, creating viral videos of my journey, doing stupid stunts like the Polar Bear plunge, etc, all with the goal of doing these things in exchange for raising support to pay off my student loans. I want you to sponsor this journey. Your sponsorship will match my funds raised up to half of my entire student loan debt, and in exchange for this sponsorship you can place your brand on everything I do. I will wear your t-shirts, I will put your logo all over my social media. I will create unique videos for your brand and sing your praises to all of my social media followers. Local media will pick up on my activities and your brand will be plastered all over the local (and hopefully national) media outlets. You’ll receive much more benefit from this free advertising than you could ever buy with the money spent on my student loans.” End pitch.
You’ll need to find the right company, but an entrepreneurial company will be able to see the potential benefit in partnering with you as you journey towards paying off your student loans.
Who knows, this company may end up liking you so much and receiving so much value from your promotions that they end up hiring you full-time!
There are many ways to pay off your student loans and even create your own student loan forgiveness program. You just have to be creative and put in the work.
Would you consider any of these ideas?
Photo Credit: bee32 / 123RF Stock Photo
DJ works in financial services at a large public university. He lives in the Southeast with his wife and young daughter.