Student Debt Today
37 million student loan borrowers with outstanding student loans
Between $902 billion and $1 trillion in total outstanding student loan debt in the United States
Source: American Student Assistance
Student debt maintains its status as a national talking piece as to what can be done for those finishing or beginning their college education.
As a result, alternative methods have arose to allow students a chance to alleviate their debt. The most recent of which is a company called Sponsor Change which began a pilot operation in 2009.
“Sponsor Change is a program that wants to get millennials volunteering again and increasing our volunteer rate while also helping pay off student loan debt,” said Shawn Agyeman, marketing director for Sponsor Change.
Sponsor Change works as a staffing agency for non-profits, serving as a medium by which donors, non-profits and students communicate and arrange working together, and eventually doing so online.
Seventy-one percent of college seniors last year graduated with an average debt of $29,400, from 2008 to 2012 debt at graduation has increased an average of 6% each year according to Project on Student Debt. Total student debt is estimated between $902 billion and $1 trillion, according to American Student Assistance.
Between 2010 and 2012, the average millennial volunteer rate ranged from 15 to 38.2 percent from state to state, including the District of Columbia.
Sponsor Change’s business model and idea comes from the notion that since student debt has risen to extremely high levels, the amount of volunteering students has decreased because they have to find ways to alleviate the burden of student loans. Earning money takes up most of their time.
Agyeman said his company believes non-profits, individuals and government entities can come together because they have mutual interests: One is looking to get rid of debt and the other is needing specific skill sets.
“What we want to do is we want to marry the prospect of volunteering and student debt payment for skill based labor,” he said. “Because we believe a lot of people got to college to get skills, computer engineering or architecture.”
The company acts as an intermediary, connecting volunteers and orginzations.
“Individuals, corporations, government entities go, ‘Hey we have this project that we need completed and we would like someone with certain skills to do it. I want someone to build my website,’” he said.
The two parties communicate with the help of Sponsor Change as to what they want and in the end the sponsor, nonprofit or other organization, pays the Change Agent, volunteer, directly to their loan agency to get rid of their debt by whatever agreed amount.
It could be $1,000 or $2,000, but it depends on the contract, Agyeman said.
Currently, Sponsor Change is in the process of moving its services online and only operates in Chicago, Pittsburgh and Washington D.C.
The new online platform will work as an online exchange between volunteers and causes.
“You wouldn’t need me to do the busy work of matching,” he said. “[Also, we are] putting together a crowd-funding platform, so if you wanted to raise money for a project that you were doing that went toward your student debt while trying to help homeless people or children in Africa.”
He described the company’s mission as a two-way street.
“It’s kind of like give back and pay back, if I could sum up our motto,” he said.
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