Ahead of the expected end of the federal student loan forbearance, Equitable has announced it is rolling out a free tool designed to help nonprofit employees determine their eligibility for the Public Service Loan Forgiveness program.
The new eligibility tool will help individuals see an estimated forgiven loan balance, detail next steps for applying for forgiveness and provide information on how to increase further savings. It is the latest of several expanded services that aim to help individuals in the nonprofit sector manage student loan repayments ahead of the expected end to federal forbearance on May 1.
The new eligibility tool was created in conjunction with StudentLoan Tech, a firm focused on helping student loan borrowers access the PSLF program. Individuals can also choose to connect with an Equitable Advisors financial professional who help can provide additional insights on maximizing their retirement savings.
“The burden of student loan debt remains a structural barrier to financial wellness, particularly for those who dedicate their lives to public service,” says Jessica Baehr, Equitable group retirement head. “The Public Service Loan Forgiveness program is a tremendous benefit for those who qualify, but we recognized the challenges and complexities in navigating the PSFL eligibility and repayment criteria. We are excited to help more educators reduce their student loan debt by offering them a simple process to easily determine their eligibility, quickly enroll and save more toward their financial goals.”
Nearly half of all educators have taken out loans to pay for their education, and more than half of those educators still have a balance of $58,700, on average, according to research from the National Education Association. Nearly 33% of all American students now go into debt to pay for college and, collectively, students owe nearly $1.6 trillion in student loan debt, according to research from the Board of Governors of the Federal Reserve System and the Federal Reserve Bank of New York, respectively.
The Public Service Loan Forgiveness program offers debt relief to educators and public employees who qualify. Borrowers must work full time in public service, including in a nonprofit 501(c)(3) organization, the military, public schools, nonprofit hospitals or government. In addition, borrowers must be enrolled in an income-driven repayment plan or the 10-year standard repayment plan. After making 120 qualifying monthly payments, the remaining loan balance is forgiven.
“Managing student loans can be a daunting process. Although the resumption of payments may feel far away, now is a great time for borrowers to put a plan in place and determine what their payments will be when they are reinstated,” says Randy Lupi, Equitable Advisors regional vice president. “In addition, one of the recent changes to Public Service Loan Forgiveness gives borrowers until October 2022 to potentially receive credit for past loan payments, making now a great time for borrowers to see if they are eligible, correctly enroll and potentially receive forgiveness sooner.”
« Alternatives May Have a Place in DC Plans