The Benefits Portfolio

The 1-2 Punch to Knockout Student Debt: Crowdfunding and Employee Loan Benefits

As defaults mount, new solutions emerge

THOUSAND OAKS, Calif., Oct. 2, 2017 /PRNewswire/ — According to the Federal Reserve Bank of New York, the average default rate on student loan debt is 11.2 percent. More specifically, it is estimated that no payments were made on $137 billion in student loans due in 2016.

This represents a 14 percent increase in defaults compared to 2015. Given the increasing student debt load and inability for many to overcome this burden, additional methods to repay student debt must be utilized. LoanGifting harnesses the power of crowdfunding and employee student loan benefits and can help those with student loans that can put student debt on the ropes.

According to the Crowdfunding Industry Report, it is estimated that over $34 billion was contributed to crowdfunding campaigns in 2015. $5.5 billion, or 16 percent of which, was directly related to reward and donation contributions. In the future it is anticipated that crowdfunding will have a sizable impact on student loan debt. Between 2014 and 2015, the volume of crowdfunding increased by 82percent in North America, from $9.45 billion to $17.2 billion respectively. If this trend continues, there is significant opportunity for student debtors to benefit from crowdfunding.

The new and Innovative LoanGifting SaaS Fin Tech solution was created to help overcome the estimated $1.5 trillion student loan debt epidemic. Visit here.

Implementing alternative solutions

One student loan debtor who is cashing in on the crowdfunding benefit is Katie Curnow. Katie holds approximately $92,000 in student loan debt and leverages the power of LoanGifting and her personal website to repay her student loans. In return for a $1 donation on her website, Katie offers advice on a variety of topics from college to parenting. For a $50 donation, Katie will send you a handcrafted gift. You can learn more about Katie’s website at

With the help of LoanGifting and the crowdfunding community, Katie has been able to pay off approximately 12.5 percent of her student loans. By implementing alternative solutions to repay student loans, others similar to Katie can eventually eliminate their student debt.

With the help of LoanGifting and the crowdfunding community, Katie has been able to pay off approximately 12.5 percent of her student loans

Employers are also deciding to jump in the ring given the stress and financial burden student loans place on employees. In what Forbes calls the “Hottest Employee Benefit of 2017,” student loan benefits have numerous advantages for employees and employers. To begin, the return on investment for a student loan benefit is better than a 401(k). Due to high interest rates associated with student loans and the volatility of financial markets, student loan benefits can have a greater impact on financial well-being. In fact, a recent poll by American Student Assistance found three out of five employees prefer to payoff student debt compared to contributing to a retirement plan.

A new HR benefit?

In addition, according to the 2015 American Student Assistance Survey, over 50 percent of respondents said they’re worried about student debt and that it negatively impacts concentration at work. By providing student loan benefits, employers help alleviate stress which improves productivity, employee satisfaction and retention. Furthermore, 76 percent of respondents said offering student loan benefits helps motivate job offer acceptance. This can be a powerful recruiting tool given only 4 percent of employers currently offer this benefit.

By leveraging the financial impact of crowdfunding and employee student loan benefits, student loan debtors and employers can make a meaningful impact in the fight against student debt.

Given the inability for many funding sources to meet the high level of student debt repayment, new solutions that provide supplemental loan repayment capabilities must be utilized. It’s only a matter of time before student debt or those with student loans throw the final knockout punch. Let’s have it be the latter.

About LoanGifting
Founded in 2015, LoanGifting is a SaaS product that focuses on Fintech solutions to directly challenge the student debt epidemic. LoanGifting started as a crowdfunding site for Student Loan Debtors but due to overwhelming demand by employers for an employee benefits solution, LoanGifting developed Student LoanBenefits™, a benefit similar to a 401k but with a better return on investment. The service operates as a direct pipeline for student loan repayment and connects millions who have student debt with their extended network of family, friends and employers. Through these connections, LoanGifting allows a student debt holder’s network to give directly to his or her loan and reduce the loan principal, future interest and time for loan repayment.