Qualifying for Reductions

Building a long-term strategy now to pay down your student loans after graduation will help you build credit as you get out of debt.

Support Your Community
Thanks to private and Federal organizations, you can find loan forgiveness in community involvement. Spending a year in a service organization like the Peace Corps, VISTA, or Americorps can reduce your student loan debt by up to $5,000. Joining the Army National Guard can eliminate up to $10,000 from your debt load.

Taking jobs in certain fields can reduce your debt as you earn a paycheck. Teachers working in some low income schools or teaching in certain subjects can wipe out some or all of their student loan debt over a period of five years. There are also loan forgiveness opportunities for lawyers who work for non-profit organizations and doctors who work in economically depressed areas.

Work With Your Employer
In fields like accounting and engineering, many employers find themselves exhausting the pool of recent graduates before they can fill all of their open positions. For applicants, that means more incentive to have college degrees or training certifications. A growing number of employers offer tuition reimbursement programs that can reduce the overall amount of your student debt if you promise to work for them when you graduate.

By covering student aid payments, employers hope to lock up the best talent before graduation. If your grades are solid, you should start contacting recruiters in your last few years of school. If you already have a job, check to see if your employer offers a tuition reimbursement program. This will give you an incentive to stay with the company and your boss will have the promise of a more educated employee.

Consolidate Your Loans
If you have a group of unpaid loans, you can save money by consolidating. Student loan consolidation involves rolling up all of your loans from various lenders and programs under one large loan, with one interest rate and monthly payment. You can choose to work with a private lender or with the Department of Education. A consolidation loan uses the weighted average of interest rates on all of your loans to reduce the number of your creditors.

Debt reduction comes in many forms. Contact your loan provider for more details.