The Chronicle of Philanthropy recently posted information about the Department of Education’s request for feedback on proposed regulations regarding implementation of the College Cost Reduction and Access Act of 2007.
Come again?
Basically, this new law forgives the remaining debt of student loan recipients who have worked as full-time “public service employees” for a period of 10 consecutive years while making their payments. In other words, you graduate, land a solid gig at a nonprofit, government agency, or other still-to-be-defined “public service” employer, and you won’t have to pay any more monthly debt owed after 10 years working there or remaining in the sector.
And in theory this sounds great. But to me, and roughly half of those leaving comments at the Chronicle, the benefits seem a bit greyer in practice. Certainly, any federally mandated incentive for public service is a good thing. But the devil’s in the details. And I start to think about my own situation.
I graduated without any real clear idea of what I wanted to do. And it took me a good three or four years to land my first “real” job. It was at a nonprofit, and I liked it. But after four years there, I was the victim of budget-induced layoffs. It took me time to find another job. And even though I prefer working for nonprofits, I needed to pay the rent (not to mention my student loans). And the next job I found was with a for-profit company.
I know my story isn’t necessarily the norm, but it’s not that atypical either. Ten years is a long time in the working world, and even if you want to stay in the same job or field for that long, it doesn’t always work out that way. And, in my case, I had already paid off my loan in that amount of time anyway.
So where does that leave things? Well, some of those commenting on the Chronicle article suggested cutting back on the number of years required to work, or offering exempt status from social security tax instead. Still others noted that the law only applies to federal loans, not personal ones. And what about those committed to service off the clock?
All valid points. And hopefully ones the Education Department and others will consider in implementing this promising new law. Incentivizing and rewarding those who choose to dedicate their time to helping others seems like a no-brainer. Let’s just hope they start putting some more thought into it.