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Hello MKM Readers! For all you recent grads out there, we have a new guest post from Laur Davidson. She is freelancing her way through her university debt. Give her some student loan crushing encouragement in the comment section below. Enjoy!
For many college graduates the perfect job is one that pays well for the knowledge and skills they spent tens of thousands of dollars to acquire. However, the nature of today’s competitive job market requires more latitude when trying to meet all expectations.
Graduates must be able to weigh several factors and determine what they would be willing to give up in order to gain more of something else. However, for graduates with student loan debt, they may want to include in their job search positions that offer assistance in paying it down.
Student Borrowers Start Their Careers in the Hole
It is not completely unreasonable for a college graduate to feel they have their whole lives ahead of them and that paying down student loan debt, should get easier as they move forward into their careers. However, considering hard statistics describing the plight of tens of millions of student borrowers, it would be just as reasonable for them to take note.
Nearly 80% of college students leave school with an average $30,000 of student loan debt. With a lifetime ahead of them, that does not seem insurmountable.
On average, it takes college graduates is six to nine months to begin repaying student debt. The good news is that student borrowers are allowed a six month grace period before loan payments begin. The bad news is that, in that time, loan interest continues to accumulate, which increases the debt.
— Andy Hill (@AndyHillMKM) June 19, 2017
Statistics also show that more than half of student borrowers don’t earn enough money in that time to be able to make the loan payment on top of other expenses, which why more than a third move back in with their parents. That is just the early years. As times goes on, student borrowers are finding it difficult to meet their most basic needs, such as buying a house or a car, starting a family or being able to retire on time.
In addition, recent studies have shown that location after graduation is important. Certain areas with high costs of living, and low early career pay, setup a challenging environment to pay back student debt.
Jobs That Offer Student Loan Debt Relief
While recent grads do have time in their favor, finding ways to get out from under their student loans early, increases their chance of enjoying a normal lifestyle. As it turns out for many student borrowers, the best job opportunities may be the ones that provide some sort of assistance in pay down student loans.
Student Loan Forgiveness Programs
For grads entering certain fields, there are opportunities available that offer student loan forgiveness as an incentive. The idea of having a portion of your debt wiped away may seem too good to be true, but if you plan on entering public service that is exactly what can happen.
There are eligibility requirements and, aside from the forgiveness incentive, the positions may be less desirable in term of salary, working conditions or location. However, with the prospect of having your debt burden reduced, they are worth considering.
Loan Repayment Assistance
An increasing number of companies in the private sector are offering student loan repayment assistance as an employee benefit. Most companies offer a reimbursement plan that pays a fixed amount toward an employee’s annual loan payment up to a maximum amount.
PriceWaterhouse Coopers was one of the first major companies to offer the plan with a maximum benefit of $1,200 per year for six years. Some companies reimburse as much as $6,000 per year up to a total of $30,000. Employees are eligible for the benefit after six to 12 months of employment and they must be current with their payments to be eligible. Any employee with student loan debt can participate, but some plans may be restricted to federal student loans.
Utilizing a repayment assistance plan, borrowers can apply the annual savings in loan payments to accelerating payments on the loan, or to increase their annual contributions to their employer-sponsored retirement plan. Either way, this valuable benefit can enable student borrowers to get on the path to a normal lifestyle more quickly.
Are you battling student loan debt?
What methods are you using to clean it up?