Organizational PSLF Programming

Many 501c3s and government entities are sitting on an employee benefit and don’t even know it, with the added advantage that it is paid for by the federal government. Employees who make 120 income-based repayments on their student loans while working in public service are eligible to have the balance of their student loans forgiven, tax-free, through Public Service Loan Forgiveness (PSLF).

It seems simple in theory—employees make 120 payments on their student loan while working in public service and their loan balance is forgiven. But, 98% of those who applied for forgiveness in the first year of eligibility were denied. Most borrowers didn’t understand why, proving the value of a small amount of student loan advice.

We know that student loans are a financial burden for many employees. To make matters worse, for the last three years, borrowers have gotten used to NOT paying on their loans due to the payment freeze during covid. That will all change shortly when payments resume. We expect to see a lot of borrowers go into forbearance or default on their loans, which will prevent them from getting credit for PSLF.

What is Project 120?

A benefit that provides employees with a plan and support for positioning their student loans for forgiveness through the Public Service Loan Forgiveness (PSLF) Program. PSLF requires that borrowers work in public service for 10 years while concurrently making payments on their student loans, for a total of 120 eligible payments.

Why does it matter?

Student loans are a serious financial burden for most borrowers. Financial stress does not go away when employees walk in the door for work. Research shows that financially stable employees are happier and more productive employees. For the employer, this benefit could lead to employee retention since eligibility for PSLF centers around the nature of the borrower’s employment.

Is it a lot of work for borrowers to pursue PSLF?

The paperwork required to apply for PSLF only takes about 20 minutes. Each year after that, the borrower sends in a form to the government so that they know the borrower still works for a qualifying employer, which only takes a few minutes as well. The problem is that most employees don’t understand what they need to do.

Does this add a lot to the employer’s plate?

The heaviest lift on the employer side is verifying employment so that your employees can complete their PSLF forms. We partner with you to educate your employees on PSLF and guide them through the process.

How does Project 120 work?

We partner with you to make your employees aware of this benefit. Those who are interested in pursuing PSLF would opt in to receive support from us. We ask your employees to take a survey and send us their student loan data so that we can analyze their situation and provide them with a personalized plan of action. We offer virtual office hours so that they can ask questions and send reminders to them when action is required for them to stay on track.

How our Guided DIY approach supports employees pursuing PSLF

1. We survey employees to get a comprehensive understanding of their loan situation and income.
We provide you, the employer, with materials to send to all employees to make them aware of PSLF and how to take advantage of this benefit. They opt into receiving guided DIY support by completing a survey and sending us their student loan details.

2. We analyze the data and provide each employee with an action plan for pursuing PSLF that is unique to their loan situation, and we offer support along the way.

We analyze each employee’s data and assign them to one of six tracks based on their loan situation. Each track corresponds to specific action items that the employee needs to take to get and stay on track for PSLF. Our student loan experts offer virtual office hours for employees who have questions along the way.

3. We work with the employer to track the impact of the program and market PSLF as an employee benefit for recruiting and retention.

One of the key components of PSLF is having employees submit employment certification forms to the Department of Education. We partner with payroll departments to track these forms so that we know who is on track for PSLF within your organization. This allows us not only to communicate with them accordingly but also allows you to track the value of this benefit.