There’s a Better Way: Why Loan Forgiveness Is Not the Be-All, End-All Solution to Reduce Student Debt


Some credit, no degree. That’s a big factor in our nation’s student debt crisis. If you leave school before graduation, you must pay off your loan for a credential you don’t have. This scenario is also tied to earning potential, which creates a classic Catch-22 for students:

“I need a better job to pay off my student loan… but I need to go back to school to earn a degree… so that I can get a better job.”

The reasons students want to return to school are also often the reasons they aren’t able to return to school. We hear this a lot at ReUp: More than 90% of stopout students we talk to want to complete their degree, no matter how long they’ve been out of the classroom. One of the most common reasons they don’t re-enroll is related to finances — either directly or indirectly. For those in the “some credit, no degree” category, this often means unpaid student loans. 

Student Loan Debt: By the Numbers
Trillions. When we were kids, that number seemed unimaginable, fantastical even: Could anyone ever count that high? Trillion is indeed a reachable number. Nearly 45 million people in the United States have outstanding student loans, adding up to more than 1.5 trillion dollars of debt, according to The Hechinger Report

  • $1.56 trillion in student loan debt
  • 44.7 million people with student loan debt

The majority of these student loans are in good-standing, however, more than 5 million borrowers have been unable to make payments for months at a time, and their loans have since entered default status.  

  • 5.1 million borrowers in default
  • $101.4 billion worth of student loans in default

Among the 44.7 million borrowers are the students who left college without earning a degree. These outstanding balances often deter otherwise motivated people from the decision to return to school. On one hand, they know they need to level-up to get to a more comfortable financial situation. On the other, they’re aware leveling-up through additional education could mean additional loans.   

Searching for an Answer: What About Loan Forgiveness?
The national student loan crisis is a bigger conversation, of course. Campuses across the U.S. are grappling with the effects of rising tuition and decreasing enrollment, while the economy at large is figuring out what all this means for the cost of living, the housing market, and population growth.  

The idea of student loan forgiveness — by way of a federal program that incentivizes people who work in public service — sounds alluring. But if you look closely at the process and the numbers, you’ll find the Public Service Loan Forgiveness Program is only available to a select number of people. 

In the news, especially during election cycles, we often hear about proposals to make education more accessible and affordable — even solutions that would allow people with significant student loan debt to wipe the slate clean (or at least a portion of that slate). While this version of student loan forgiveness seems like a dream to many borrowers, it’s not anything that’s likely to come to fruition in the near term. (This notion is a complicated, as this article from Forbes addresses.)

$29,800: average amount of student loan debt (Forbes)
Perhaps there’s a more realistic (and timely) way to reduce some of that overall student loan debt; a solution that would also empower people to overcome the Catch-22 of some college, no degree. We know that, on average, college graduates earn more than those with a high school diploma or some college. Promoting degree completion could certainly enable many borrowers to get their loan payments back on track and, ultimately, paid off. 

But it’s not enough to simply suggest someone return to school — because, as we know, they likely already want to. 

Seeing the Big Picture: The Power of Personalized Coaching
The national student loan debt crisis directly impacts what we do at ReUp. As mentioned earlier, more than 90% of stopout students we talk to would return to school if they could. But even for the most ambitious of students it can be hard to see past that pile of promissory notes. 

With encouragement and one-on-one help navigating the complex landscape and jargon of higher education funding, the possibility of returning to school becomes clearer. What people in the industry consider “common knowledge” is often not so well-known among their key audience. For example, learning about forbearance or an in-school deferment — and how it works — could bring so much hope to someone who thought it’d be impossible to go back to school while working.  

2.6 million borrowers have $111.1 billion in student loans in forbearance
ReUp’s personalized coaching was designed to uncover and address obstacles like this. Our Success Coaches help potential returning students connect to their motivations. What’s more, we help them understand the math behind their options. To see the full picture, short and long-term. And help them plan for it.

Not all students have ready-access to this kind of professional advice, though. Colleges and universities often don’t have the resources in place to educate returning students on the process of re-enrolling and how it relates to current loans and future financial aid options. Our coaching helps connect students to the right people and resources on campus and prepares them with the right questions to ask. Knowing what the power of personalized success coaching can achieve may serve as inspiration for schools to revisit their approach to both stopout students and financial aid programs alike. In fact, ReUp also works with our partner schools to uncover the key roadblocks returning students encounter, financial and otherwise, and co-create effective ways to remove them.


The student debt crisis isn’t going away any time soon, and it’s not something any one person or institution can solve. But, in the meantime, every student we can help complete their degree is one step forward.