How you can pay off student debt while you work

Student loan debt is a crisis that has been making its way through The United States for quite some time now. Education in premium institutions is extremely expensive especially for students belonging to the middle class and lower-middle-class strata of society, this implies that by the end of their educational tenure most students have built themselves a considerable amount in student debt. Apart from the college tuition, other necessities like books, stationery, food, and clothing, all constitute student expenses. The scholarships given out are highly competitive and the majority of the student population does not qualify. Federal Reserves have established that America has a total of $1.73 trillion in student debt. So how do we help the student populace of our country? Mentioned below are some ways you can manage your student loan:

• Overpayments but the right way: A lot of students choose to make extra payments to cover their debt faster however if you want to pay off your loan faster you have to make extra payments in the right way. Loan service providers usually deduct the overpayments from the money you need to owe next month, this just gets your due date pushed but you wouldn’t actually be able to pay off your loan faster. Instead ask them to consider the overpayments for that month itself, in this case, you will be able to pay off the loan faster. 

• Refinancing: If you have good credit and a steady job then refinancing your loan might be a good option to pay off your loan faster. Refinancing converts student loans to a single private loan with a lower interest rate, now this may increase your monthly payment amount but you can cover your loans up to 5 years faster. If you are looking for programs that are based on income-driven repayment or the Public Service Loan Forgiveness program then you shouldn’t opt for refinancing.

• Autopay: Autopay is another method to reduce your interest rates. Many federal student loan services offer a reduction in interest rates if you allow them to auto-debit the repayment amount from your bank account. The same is offered by many private loan providers as well. Reduction of interest rates helps you save money over your repayment.

• Extra Money: If you get bonuses or stumble upon some extra cash then allot a portion of it towards repayment of loans. For example, 50% of extra money can be for loans, 20% for savings, and 30% for miscellaneous. 

Employers are now helping employees pay their student debt and work from home at the same time. Take a look at some companies that support this system :

• Abbott: Abbott is a healthcare research company located in Abbott Park, Illinois. Their Freedom 2 Save program allows employees with student loans to divert the 2% that they would normally contribute to their 401(k)s to receive a 5% match to pay off their loans faster. This enables them to show that they are contributing 2% of their pay to repay their loan which in turn allows the company to contribute 5% to their 401(k) account. Eventually, because of this system, the employees will have zero spendings. They currently have openings for the position of Senior Business Analyst and Senior Regulatory Affairs Specialist.

• Fidelity Investments: This financial services company based out of Boston, Massachusetts provides employees with student debt, $2,000 a year, and a lifetime maximum of $10,000 towards repayment of their student loans. The corporation claims that this policy has reduced employee turnover by 70%. They are currently hiring for the roles of Principal Content Strategist and Investment Solutions Representative. 

• New York Life: This insurance company based in the United States pays $170 every month over the time of five years towards repayment of student loans. While working employees can reduce their student loan debts up to $10,200. They are currently hiring an Implementation Manager and Business Analytics Advisor.

• Nvidia: Nvidia corporation is a technology company based out of Delaware and Santa Clara, California. Employees of this company can apply for reimbursement of their student loans of up to $6,000 a year, $30,000 maximum. They are currently hiring for the roles of Senior System Software Engineer and Automotive Visualization Designer.

• Parallon: Parallon is a company that helps people with their revenue cycles, especially businesses. Currently, they work with healthcare facilities like hospitals by partnering with them and managing their finances. This company with its headquarters in Nashville, Tennessee provides $100 per month to full-time employees towards repayment of student loans and $50 per month to part-time employees. They are currently hiring a Coding Quality Reviewer Specialist and Coding Resolution Specialist. 

Sources: 

• NerdWallet.com

• CNBC.com

• Abbott.com

• Fidelity.com

• Nvidia.com