6 Student Debt Payment Incentives Congress Should Pass

Student DebtImmediate Relief for Students Struggling with Student Debt

As a writer and blogger on the topic of scholarships, I teach student how to find and win scholarships so they can avoid student debt entirely. However, that’s not always possible and many students find themselves struggling to make payments, moving back to their parents’ home, and taking any job just to write that monthly student loan check.

My son and I are both first-generation students carrying student loan debt. One night during dinner, we had a discussion about measures that could be taken by Congress that would help students and families struggling with student loan payments. Here’s what we came up with:

1.  The ability to make pre-tax payments towards student loans through payroll deductions, similar to a Health Savings Account (HSA).

2.  Accounts employers can match employee contributions into, similar to a 401K, whose sole purpose is to make payments toward student loans at the end of the year. Tax benefits to employers that participate.

3.  Immediate Relief Act needed to allow Americans to tap into 401K/retirement accounts without penalty in order to make payments on student debt. A retirement account does no good when the profit being earned is surpassed by the interest compiling on student debt. Many unemployed or underemployed Americans need penalty-free access in order to “restart.”

4.  Federal and State taxes charged to Americans for income-earning accounts such as savings, money market, or capital gains on investments should be credited back if the taxpayer can demonstrate they have made payments of an equal or greater value on student debt.

5.  Tax credits on all money paid toward student loan debt—not just interest.

6.  Financial incentives such as interest rate or principal reduction for Americans making fair payments on student debt during period of deferment or forbearance.

Would any of these 6 policy changes help you? Can you add other measures that would help?

Class-based College Support Services Needed

Class-based College Support Services NeededThroughout my time at UChicago, I struggled to find community and a sense of belonging. As a Hispanic, I joined Latino cultural groups, but couldn’t find what I was looking for. For a while, I just thought there was something inherently wrong with me. I couldn’t find another way to explain my difficulties in feeling I was a part of this institution. It wasn’t until I formed a class-based group on campus that I was able to connect with people that were similar to me—low-income and first-generation students.

In December of my junior year, I had almost resigned myself to struggling and feeling socially isolated, until I read The New York Times article, “For Poor, Leap to College Often Ends in Hard Fall.” This article helped me understand why I felt so isolated. It tells the story of three teens who, against all odds, went on to attend college. Because of their low-income and first-generation status, they all faced major challenges, such as navigating difficult financial aid forms alone and juggling a job while taking rigorous classes. They experienced a lack of advising and peer support on campus. Until I read this article, I had never considered the strong connection between my feelings of social isolation and being a low-income, first-generation student.

My story, as it relates to class background, points to the many reasons I struggled at UChicago. I grew up in a single-parent household, attended non-selective K-12 public schools in Chicago, and didn’t receive much adult guidance. This made it easy for me to make mistakes. My safety net was always precarious, but it wasn’t until college that it hit me the hardest. Attending public schools had not prepared me for the academic rigors I encountered at this elite school. I had come in with clear disadvantages and challenges, but UChicago did little to alleviate the disadvantages students like me face everyday on campuses across America. When UChicago, like many other schools, began actively recruiting low-income and first-generation students, they didn’t consider the need to provide support systems needed to ensure student success for this population.

There was no staff designated to work with low-income or first-generation students. There were no mentoring programs or established student communities. These resources would have made a significant difference in my experience and would have alleviated the sense of social isolation I felt every day. It would also have made it easier for me to identify staff who are trained in diversity and equity issues. With little institutional support and a lack of understanding of what it takes to succeed on an elite college campus, it’s no wonder I struggled.

With a developing sense of my own class identity, I started a discussion on class-related issues at UChicago. For the first few months, I just blindly initiated conversations with classmates and other campus cultural groups (e.g., African-American, Latino, etc.) I began by posing the question: “How does class identity affect your experience at UChicago?” As these conversations unfolded, I uncovered similar experiences and difficulties among my classmates—feelings of isolation and marginalization and the inability to discuss financial struggles. As I slowly identified more students who shared my experience, we decided to take action. We put together a panel discussion on low-income students and launched a Facebook page called “UChicago Class Confessions” to collect anonymous stories of class-based experiences. There are some of the shared thoughts:

“Because of my low economic status, I have had to return home for the summers (away from Chicago). This has been disadvantageous since I have had virtually no access to paid internships. For the first two summers of collect, I had to return to food-service jobs. I wish I had the privilege of having enriching summer internship opportunities for those two summers.”

“When my Dad helped me move into my dorm last year, one of the housekeepers though he also worked there because of his uniform. My Dad had just finished his shift as a janitor at a bank in a suburb of the city. I often feel ashamed to tell people this, but I shouldn’t…my Dad works hard and that’s something to be proud of. Why should hard-working people be seen as less in the eyes of others?”

Although we are no longer collecting confessions, our Facebook page was so successful that USA Today wrote an article about it. Aside from our page, we also had meetings with college administrators, including the Dean Students in the College, the Director of Study Abroad, and the Financial Aid Director to discuss the lack of resources for low-income students. After our initial success, we decided to call our group the Socioeconomic Diversity Alliance.

Over the last year, our group has been instrumental in amplifying the voice of low-income and first-generation college students through conversations, panel discussions, and meetings with administrators to discuss the lack of resources available and what can be done to address this important issue. We have been successful in gaining the attention of the administration, but there are still no tangible institutional-wide changes—first-generation/low-income mentoring program or a dedicated staff member.

With this new demographic actively sought by Admissions Offices, support resources are not only an acknowledgment of this groups unique needs, they are critically needed to succeed academically and graduate on time. First-generation students are trailblazers. They count on less parental guidance and support than other students because their parents haven’t gone to college and cannot offer experiential-based advice. It is still extremely difficult to find people within UChicago that understand the low-income and/or first-generation student enough to provide support. Among elite institutions like UChicago, resources for this population of students are increasing, but remain scare. Offices like the Stanford Diversity and First Gen Office are virtually unheard of at peer institutions.

Elite institutions have failed to accommodate the growing demographic of low socioeconomic status and this is why we need more campus groups dedicated to class issues, specifically low-income and/or first-generation college students. Student mobilization will be crucial to getting institution resources. More student voices will change the rhetoric. Student groups also have to exist to provide the services and resources colleges lack, such as mentoring programs for underclassmen and workshops on navigating the university and financial aid systems. The Socioeconomic Diversity Alliance at UChicago is helping to fill a void that exists at the school, but this type of group is sadly rare on college campuses across America. We need to change that in order to become a more visible population on campus, which will lead to more resources allocated to meet our unique needs and help us have a successful college career with the same opportunities enjoyed by our higher-income peers.

Class matters because it shapes who we become and the resources we have throughout our lives. Campus groups dedicated to socioeconomic class are one way to acknowledge this reality and provide low-income and first-generation students with the much-needed resources to level the playing field and provide equality across socioeconomic strata.

Do you have a similar experience? What kind of support does your school offer? What support do you need?