Four Colleges Explore Different Approaches to Deal with Student Debt
Posted By Ashley Eneriz on August 8, 2016 at 9:11 am
The average 2016 college graduate holds more than $37,000 in student loan debt. If that amount is not burdensome enough, the weight of that student debt can cause those just beginning their careers to miss out on $500,000 in retirement savings later down the road.
While student debt is detrimental to finances, many students still take on the huge loans because they don’t know how else to get their degree. Before falling into the student loan trap, college students should be aware of the creative solutions available to them to help afford college, from scholarships and grants to unique college programs that reduce graduation debt.
Here are four programs available for college students who wish to earn their degree without a heavy load of debt.
Guaranteed job program at Thomas College
Thomas College in Waterville, ME, is a small, private college that takes post-graduate student debt seriously. The college’s Guaranteed Job Program allows students to work with college’s career services while they pursue their degree. Thomas’ goal is to equip students with a marketable degree, along with the necessary skills to land them a job.
One huge benefits of the program is that if graduates cannot find a job six months after graduation, they can choose the following perks:
- Loan Repayment: Thomas College will make monthly payments on eligible graduates’ federally subsidized student loans for up to 12 months.
- Free Graduate Tuition: Graduates can also choose to enroll tuition-free in six evening graduate courses at Thomas College.
To be considered for this program, Thomas College students must have a 3.0 or higher GPA, and they must demonstrate leadership and community service. Graduates must meet with Career Services within 30 days after graduation and every month afterwards until they are employed.
Responsible borrowing initiative at Western Governors University
Western Governors University in Salt Lake City, UT, launched its Responsible Borrowing Initiative three years ago and already has seen a huge reduction in its graduates’ debt level. The program has decreased the average borrowing WGU student’s loan $3,200 each year, which is a 40% reduction.
Bob Collins, vice president of financial aid at the college, explains what the program entails. “Borrowing more than you need is never a good idea,” he says. “In 2013, Western Governors University launched its Responsible Borrowing Initiative to encourage students to borrow only what they need to complete their degrees.”
It has proven to be successful for both students and the university. “In 2015, the average (for those who took out loans) was $19,050, nearly $10,000 less than the national average,” Collins says.
Interest freedom plan at Northwestern
Many graduates find themselves struggling to find jobs that fit in their line of work that also pay their desired salary. Northwestern University School of Law started the Interest Free Plan that will pay the loan interest of graduates who pursue positions in the private sector that pay less than $85,000. It will do the same for graduates who are unemployed after six months of graduation.
Daniel B. Rodriguez, dean of law school, is confident that most graduates of the school receive prominent employment positions within the law field. However, not all students wish to use their degree solely within the courtroom. “Moreover,” Rodriguez says, some of our students are pursuing less traditional, less immediately lucrative positions, and some, albeit a small number, undertake job searches that extend into the period during which they would begin repaying their student loans. Our goal is to assist these students as they embark upon highly successful and hopefully satisfying lifelong careers.”
Loan repayment assistance program at Houghton College
Houghton College in Houghton, NY, asserts it was the first college in the Eastern United States to offer a Loan Repayment Assistance Program. The LRAP is designed to to assist or completely repay a student’s loans after graduation when he or she earns less than $38,000.
Back in 2013, when the program was first established, Marianne Loper, director of student financial services at Houghton, said, “While a Houghton student graduates with an average debt load of about $5,000 less than the national average, Houghton still sees this program as a significant and important investment to make on behalf of our students.”
Learning to avoid student debt while also learning to manage money will help college students graduate with a more freedom. Enrolling in one of these programs can give graduates more confidence upon earning their degrees, as well as the flexibility to find the job they love, rather than settling for the job they need to deal with their debt.