Dig Yourself Out from Under that Student Loan Burden

Student loans are a terrible burden for many people, and the number of delinquencies and defaults on student loans is just rising. If you're having a hard time keeping up with payments, here are your options for easing that burden.

If you have a federal loan, there are four major repayment plans available to you, ranging from payments as low as $5 a month for 25 years with the income-contingent repayment plan, to the standard loan repayment plan that lasts 10 years and in which you pay a minimum of $50 a month. You can also choose the extended repayment option, also $50 a month minimum, but payable over 12 to 30 years, or the graduated repayment program that's also 12 to 30 years but with a lower $25 per month minimum payment.

Which repayment plan is best for you? If you have a lot of student debt but a modest salary, the income-based repayment plan is recommended, not just because your payments are based on your income, but also because after 25 years the remaining student loan debt will be forgiven (10 years if you work in public service).


If you can afford to make a higher monthly payment, it's best to do so to avoid paying thousands more in finance charges, MSN Money advises.

Unfortunately, for private loans, you'll need to negotiate with the lender.

There is one option you can explore that may pay off your student loan right away, whether private or federal: getting your employer to pay off the debt for you.

Many organizations will do so if you sign an employment incentive contract. This means that as a "bonus" or perk to you, your job pays off your student loans. In turn, you agree to be a loyal employee and remain with the company for a given period of time, say at least two to three years.

It's definitely worth a shot, and can save you decades of student loan misery. Photo by bredgur

How to ease your student loan burden | MSN Money