– You have student loan
debt, and you want it gone. But where do you start? Welcome to The College Investor. I’m Stefanie O’Connell,
from stefanieoconnell.com, here to break down some
of the best strategies that you can use to erase
your student loan debt. Not all of these will
eliminate your student loan debt completely, but
each solution can help. One, qualify for a federal
student loan forgiveness program. This strategy applies to people
with federal student loans. These are student loans
that are typically handled by the Department of Education, or one of their student loan servicing companies. There are three major and several smaller student loan forgiveness programs. The most popular federal student loan forgiveness program is Public
Service Loan Forgiveness. This program offers
student loan forgiveness to people who work in
public service for 10 years. Public service not only
includes government jobs, but it also includes many non-profit jobs, educations jobs, and service jobs, like law enforcement or public safety. The other two common ways to get federal student loan forgiveness,
is to be a teacher, which has its own teacher
loan forgiveness program, which doesn’t cover as
much as public service loan forgiveness, and military
service loan forgiveness, which is also being phased out due to the public service loan forgiveness program. Two, find state assistance
for your student loans. 46 out of 50 states offer
at least one student loan forgiveness program, with some states offering many different programs to cover a wide variety of loan
types, employment, and more. Before you give up on not qualifying for federal loan forgiveness
programs, check your state, and see if they offer any
incentives or assistance. Three, find out if your
employer offers any assistance. Working during college
is one of the smartest moves that any student
can make, but if you’re already working, why not make sure that you’re taking advantage of all of your employer’s benefits,
and see if you can’t eliminate or erase some
of your student loan debt with a tuition reimbursement program. Many of these programs require you to pay up front, thus, take out
student loans, and then provide proof of course
completion to your employer. Once you’ve completed
the class, your employer will typically reimburse
you through your paycheck. Now, already done with school, and buried in student loan debt? Some employers offer signing
bonuses and other perks to potential employees,
but you have to ask. Along with negotiating that
first salary after graduation, you need to see if your employer will offer any help with
your student loan debt. Also, a new trend is
emerging with employers, offering student loan
repayment assistance, where they will pay off
a portion of your loan for each month or year of
service, up to a given limit. This can be a great
perk if you can snag it. Four, consolidate your
federal student loans. While consolidation by
itself, won’t help you lower your payments or
your student loan balance, it can help you get financially organized. Each of your loans can have a different payment amount and due date. If you mess up one payment, you could harm your credit score, and be
hurting your financial future. That’s why simply consolidating it, organizing your student
loans, can be so valuable. Five, find a repayment plan that matches your ability to pay. After you graduate, you
are automatically enrolled in the the standard repayment plan. This is 10 years of even payments, which may not work for all borrowers. If you have federal student loans, there are many repayment plans that could help you make your student
loan debt more manageable, which in turn, will help you
eliminate your debt faster. If you plan on your income
going up in a few years after graduation, you
could look at a repayment plan like graduated,
which has a lower up front payment that rises over time. If you want a lower monthly payment, but you’re okay with paying
it over a longer time, look into the extended repayment plan. Six, set up an income based repayment plan with loan forgiveness. When selecting a repayment plan, if any of the above standard
options still don’t work, federal loans offer income
based repayment plans. There are several versions of this, but the most popular are income based repayment, and pay-as-you-earn. Many people don’t realize that both of these plans offer student loan forgiveness at the end of the repayment term. Any remaining balance on
the loan will be forgiven, but unlike the federal student
loan forgiveness plans, you will owe taxes on the amount forgiven. Regardless, this is an excellent benefit. With both of these plans, you simply provide proof of income,
and the Department of Education calculates a monthly payment for you that is 10% of
your discretionary income. That means your monthly student loan payment will be affordable. You do have to resubmit
your income annually, and your payment could
rise as your income rises. If you’re in public
service, signing up for income based repayment,
or pay-as-you-earn, and combining it with public
service loan forgiveness is one of the best ways to
minimize your student loan debt. Seven, refinance your student loans. If you have private student loans, the best way to start
eliminating this debt is to refinance your private loans at a lower interest rate. This will not only save
you money and interest over the life of the loan, but it will also lower your payment up front. One of the best tricks is
to refinance your loans at a lower payment, but continue paying your previous payment amount. This could potentially shave
years off of your loan, saving you hundreds, or
even thousands, of dollars. Eight, earn more money. Finally, if none of these options work, or none of them totally
eliminate your student loan debt, the next best thing you can do is earn more money and put that cash straight to your student loan balance. For more debt pay-off
strategies and resources, visit thecollegeinvestor.com,
and subscribe to the channel. I’m Stefanie O’Connell, and
I’ll catch you next time.