Student loan debt is a fact of life for most young Americans going to college, and for many of those who’ve just entered the workforce. There’s over $1.3 trillion in outstanding student loan debt outstanding currently, and nearly 40% of Americans under age 30 are currently paying off some type of student loan. Figuring how to pay those student loans off, as well as how long it’s going to take to be debt free, is one of the biggest personal finance challenges many Americans have to face.
However, there are other options besides making monthly payments for decades on those student loans. For example, some programs can forgive some or all of your student loan debt without the need to make any payments at all. Check out some of the best student loan forgiveness programs out there so you can determine whether any will work for you.
Pursue a Public Service Career
One of the more popular and effective ways to deal with your student loan debt is the Public Service Loan Forgiveness Program, or PSLF. According to the Federal Student Aid website, the PSLF “forgives the remaining balance on your loans after you’ve made 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a qualifying employer.” Besides the 120 payments, there are other requirements for eligibility, primarily related to the nature of your employment. To qualify for PSLF, you must work for some sort of federal, state, or local government, or some type of tax-exempt nonprofit. You can learn more about the eligibility requirements for the PSLF program at the Federal Student Aid website.
Much like the public service sector, the professional volunteer field also offers some excellent options for student loan forgiveness. For example, if you have a Perkins loan, you could be eligible for as much as 70% loan forgiveness if you serve for four years in the Peace Corps. National service in the AmeriCorps program can assist with student loan forgiveness as well; you can earn nearly $5,000 each year you serve in AmeriCorps that could be applied toward loan forgiveness; many companies match the forgiveness program as well. While eligibility between these types of programs may vary, there’s no doubt that volunteering can be a great way to help people and get your student loan debt forgiven while doing it.
Become a Teacher
Teaching is a rewarding field, and if you do decide to become a teacher, another advantage of your career choice will be eligibility for student loan forgiveness. After teaching for five years, you could be eligible for forgiveness on a Subsidized or Unsubsidized Federal Stafford Loan, the outstanding portion of a consolidation loan that repaid an eligible Direct Subsidized Loan, or a Direct Unsubsidized Loan. You could also be eligible for up to $17,500 of forgiveness on any Direct Subsidized or Unsubsidized Loans, or your Subsidized or Unsubsidized Federal Stafford Loans as well. There are eligibility requirements for this program. For example, you have to teach in a low-income school or educational service agency to qualify for loan forgiveness. Learn more about the Teacher Loan Forgiveness Program.
Work in the Medical Field
If you decide to work in the healthcare profession, you may be eligible for several different types of student loan forgiveness. Nurses, for example, can be eligible for up to 100% of their Perkins Loans after they’ve worked full time for five years as a nurse. They may also be eligible to benefit from the Nurse Corps Repayment Program, which can compensate nurses for up to 85% of their outstanding student loan debt. The National Health Service Corps, which helps to recruit healthcare professionals to ensure there are no regional or specialty shortages, offers generous student loan forgiveness plans as well. All these programs have specific eligibility requirements, so ensure you research them well prior to applying.
Find a Job with Loan Forgiveness Perks
Typically, new college graduates search for a job in part to start paying down their student loan debt. However, many large American companies see debt forgiveness programs as a recruitment tool to lure top talent to their firms. Thus, they’re starting to offer it as an employment benefit. Companies such as Fidelity Investments, for example, offer up to $10,000 per year of loan forgiveness to some of their employees; other companies, such as Aetna, offer similar benefits. Many employers also participate in programs that allow their employees to exchange vacation days for student loan forgiveness. These student loan forgiveness programs vary from company to company and are still the exceptions to the rule; most employers don’t offer any sort of loan forgiveness benefits. So, when you’re out there searching for a new job, make sure you ask if your prospective employer has a student loan forgiveness program.
There are many different student loan forgiveness programs. They all have varying eligibility requirements, so find one that works for you and start applying for student loan forgiveness today!