The Uphill Battle of Student Loan Debt

Whether you’ve been out of school for years or just graduated, student loan debt has been a long-standing hurdle that has crippled many graduates’ aspirations for life without debt. Purchasing a home, getting married, having children, and saving for retirement are all milestones many people wish to achieve, but is significantly prolonged due to student loan debt (and sometimes other debts on top of student loans). Some graduates find themselves in the common conundrum of needing more school to compensate for lack of skills, but don’t have the money to continue higher education.


Between scams and failure of forgiveness programs, the student loan crisis has been tossed around legislative discussions for resolution. However, with the notoriously slow-moving resolutions in Congress awaiting progress, how can someone dig their heels in and start making a dent in their student loan debt?[1]


  • Refinance. Student loan refinancing rates are at an all-time low. Refinancing your student loan can provide lower interest rates, which would allow you to pay back less money and more quickly. One thing to note is that income and credit scores will impact your rates, so if you’re rebuilding credit or have other debt that’s hindering your credit score, it might be best to address that first (EmployeeMoney can help here!). If you are eligible and in good credit standing, you could save significantly through refinancing.
  • Consolidate. Having multiple student loans can be overwhelming. One way to help is to consolidate your loans into a single loan. The only thing to make note is that your interest rate will probably increase due to the weighted average of your existing federal student loans, rounded up to the nearest 1/8%[2].
  • Enroll. The federal government has income-driven repayment programs that are offered for federal student loans only. These programs – Pay As You Earn (PAYE), Revised Pay As You Earn Repayment Plan (REPAYE), and Income-Based Repayment Plan (IBR) – are designed to make your monthly payments affordable based on your income and family size. It is calculated by your discretionary income – the difference between your annual income and 150% of the poverty guideline for your family size and state of residence.[3] Repayment periods are dependent on which plan you are eligible for and select.
  • Forgiveness. If you’ve chosen a degree that can either be adapted to or is already applicable to the current eligible federal, state, or local public service job market, have never defaulted on a payment, and are classified as a full-time employee, you could seek loan forgiveness in ten years. While ten years may seem like a long time, it might be worth the wait. You could certainly get married, have a child, or purchase a home so long as it doesn’t impede your monthly payments in the ten-year period. This option is probably best suited for those already in federal, state, or local public service positions (or those who wouldn’t mind changing careers and possess the specific requirements to fill the federal, state, or local public service position).
  • Share. There is a new fad that has emerged called an “income share agreement” (ISA).[4] This process is where colleges (through the support of investors) provide a free or partially free education to select students. Upon graduation, those students pay the college a percentage of their income. In theory, this sounds like a great resolution – and to some it most likely will be – but also weigh your options. For example, if a student were to take an ISA for 8% of income for 104 months, the student will not owe anything after that 104-month period ends. However, if the student reaches overwhelming success, it may not be worth it as more money would be paid back than that borrowed.


Other Helpful Tips[5]

  • Pay more than the minimum payment. Do your best to budget and save – whether it’s extra money from holiday bonuses, birthday money, or a side hustle, try to put whatever extra money you have towards your debt. For example, paying more than the minimum on the smallest debt and maintaining the minimum payments for the other debts can help you reach that finish line faster.
  • Budget. Sometimes sacrificing how many movies or take-out meals per week will make up for the amount of money lost to debt payments. Find even more innovative ways to save, such as using coupons, apps with discounts, and even eating generic brands versus brand names. Use those tax refunds to make a payment towards student loans rather than that night out you’ve been craving. These lifestyle sacrifices might seem extreme, but they’re also temporary.
  • Pay off smallest to largest debt. This can help motivate you to continue crossing off those debts. Once you have the smallest debt paid off, take that money and put it towards the next smallest debt.
  • Side hustle. If you’re able to and without sending yourself over the edge, finding a part-time or freelance job can provide a little extra money to either help bridge the gap of living paycheck to paycheck and putting more money towards paying off your debt.


Student loans don’t have to be so stressful and frustrating. If you’re still feeling overwhelmed, EmployeeMoney provides affordable loans that can be applied towards medical bills or other outstanding debt that may be impeding your ability to refinance your student loans due to credit score challenges, or other financial stressors. What makes EmployeeMoney unique is that our loan eligibility is based on current employment stability rather than your credit score. We value your financial wellness and would love to help you conquer your student loans. Contact us today to learn more about our loans and how we can help you progress up that mountain of debt.