I often hear from overburdened student loan borrowers desperate to find ways to afford their monthly payments. While terms on a federal loan are somewhat flexible, private loans are nearly impossible to modify these days. What’s a borrower to do to come up with the extra money to address the sometimes six-figure student loan debt she’s carrying?
We’ve talked about getting that second or third job. But there’s also volunteering. Traditionally it pays nothing but organizations like SponsorChange.org and CharityForDebt.org aim to help borrowers lower their student loan debt by connecting them with paid volunteer opportunities.
There’s always the option of joining the Peace Corps, which makes volunteers eligible for deferment and partial cancellation of certain federal loans. AmeriCorps offers eligible volunteers stipends to be used towards student loan repayment.
But these relatively new groups don’t expect you spend months to years on a volunteer assignment. In fact the hope is that you will work and volunteer at the same time, all to increase your chances of making enough money to pay down your loans. One issue, though: The organizations have yet to expand nationally. CharityForDebt, which plans to officially launch in January, services the Washington, D.C. area. SponsorChange is based in Pittsburgh, PA. But the hope is to catch on in other cities.
In a conversation with CharityForDebt’s co-founder Jonathon Lunardi, he explains that the group – equal to wanting to help borrowers pay down debt – wants to provide a way for young adults to be charitable, something they often feel they have little time to do. And you can utilize your existing skills. ”You could use your legal degree and offer a few weeks of part-time consulting to a charity,” says Lunardi. A volunteer gig may pay you $10 to $15 an hour to be used directly for education expenses and loans. The wage is paid for by a sponsor who then gets to deduct his “donation” from his taxable income. It’s a win and win.
In a world where student loan debt has eclipsed credit card debt, volunteering your way to help pay down your loans is an innovative way to help a growing group of very needy borrowers.
College costs are climbing but before you take out a private student loan, there are a few things you need to be aware of. Read Credit.com’s report on Private Student Loans: What to Watch Out For before you apply for your next student loan.