Crowdfunding Student Loan Debt

| 6 min read Crowdfunding

In recent years, more and more students have turned to crowdfunding student loan debt to offset the cost of university study. We’ve seen students run fundraisers for specific expenses, such as set books and equipment, food, housing, transport, tuition fundraising and studying abroad, because it’s a great way to avoid taking out loans.

Sometimes, however, taking out a student loan is unavoidable – but that still doesn’t mean that crowdfunding can’t come to the rescue. If you ran a crowdfunding fundraiser each year you were at university, why not run another one to help you pay off your debts? If nothing else, crowdfunding student debt can dramatically reduce your loan balance.

Unlike student loans, the funds you receive through crowdfunding don’t need to be repaid – except in gratitude to the friends and family who support you. Once you’re established in your career, you can return the favour, maybe by helping to support other students who need a helping hand.  

Some facts about student loans in Australia

  • While some Australian students are eligible for the Higher Education Loan Program (HELP), many will not. HELP also does not cover any of the complementary costs of tertiary education, such as accommodation, transport, student learning materials or trips and study equipment (like laptops). This is all at the students’ own expense.
  • Unlike most other forms of debt, including credit card and consumer debt, student loans can’t be written off or cancelled – even in the event of bankruptcy.
  • They are indexed with inflation in Australia, which is a type of interest rate that is benchmarked against the real cost of living. This means that, if not repaid, it will continue to grow.

How does crowdfunding student debt work?

People use GoFundMe to raise funds from friends, family and members of the local community which they then use to pay off their student loan balance. At GoFundMe, we have a 0% platform fee for organizers and there’s no penalty for not reaching your fundraising goal. What’s more, you can withdraw funds as soon as you start receiving donations.

To pay off student loans through crowdfunding, we recommend that you follow these steps.

1. Pick your platform

There are many options for online crowdfunding student loan debt. GoFundMe, unlike other platforms, is and charges no platform fee for organizers– which means that you keep more of the money you raise. If you’d like to see how we compare to other platforms, see Which Fundraising Site has the Lowest Fees.

When you’re choosing a crowdfunding platform, never underestimate how important it is that people can access it easily on their tablet or smartphone – or share your fundraiser on social media. GoFundMe is designed with mobile devices in mind with a robust mobile app and it’s well integrated with all the social networks you can use to share your fundraiser. We also offer 24/7 support and a wealth of fundraising resources – such as the post you’re reading right now! – on our blog.

2. Set up your fundraiser

Creating a GoFundMe is easy. But just because it’s easy, don’t enter into it lightly. You’ll make several important decisions during the set-up process, including naming your fundraiser. This name will be the first thing people see on social media. For advice on how to choose an effective name, see Great Ideas for Naming your Online Fundraiser.

3. Add photos and videos and tell your story

Your featured photo is the first thing people see when you share your fundraiser with them. And don’t stop at just one! – our data shows that fundraisers with multiple photos raise significantly more than those with a single image. To learn more about using photos in fundraisers, see How Images can Lead to Fundraiser Success.

Video is another powerful tool for attracting prospective donors. Videos can also reach people who you can’t connect with by any other means. You can share them on YouTube, Twitter, Facebook and other platforms – and they all have a link to your fundraiser. To learn more about using video effectively, see The Power of Video.

At the end of the day, photos and videos help you to tell your story – the heart of which is your fundraiser description. Telling your story honestly and clearly is essential. If you’re not quite sure where to start, we’ve put together some helpful storytelling tips in Your Crowdfunding Fundraiser Story: A Comprehensive Guide.

4. Share your fundraiser

Sharing is powerful and the best way to secure the most donations. Every time you share your GoFundMe fundraiser on Facebook, that fundraiser will net an average of $43. For a detailed guide to effective social sharing, see Using Social Media to Promote your Fundraiser. There are other ways to share your fundraiser too. Take a look at Online Fundraising without Social Media: 42 Ways to Share Offline and learn how to raise awareness in 15 Simple Ways to Skyrocket Awareness for a Cause.

5. Follow up

Posting updates for your supporters keeps them informed of how your fundraiser appeal is progressing and updates can lead to more donations and more sharing – especially when they highlight your progress. Writing an effective update is an art unto itself and we cover all the details in How to Write a Fundraising Update.

Thank you notes are another essential fundraising tool. If you have a fundraising team, we suggest that one person focuses on writing thank-you’s. For some ideas, take a look at 20 Affordable Ways to Say Thank You to Donors. Don’t forget that thanking donors is not only the right thing to do, it can also help your fundraiser flourish – see Viral Fundraising: Make the Most of your Fundraiser’s Potential.

See how crowdfunding helped Shannon offset her debt

After Shannon Otto was featured in The New York Times podcast “The Daily”, people responded to her story about the suspension of her nursing practising licence after falling behind on her student loan payments. One listener started a GoFundMe for her, but it turned out that Shannon had already set one up for herself – and it ended up raising more than $9,000. Read about it here: Shannon Otto Student Loan.

Crowdfunding can help you reduce or pay off your student debt

Crowdfunding is a great way to cover the costs of getting a degree: before you start, while you’re actually studying and after graduation. Whether you’re raising funds proactively or retroactively, we’re here to help you every step of the way. The sooner you pay off your balance, the less time it will take you to be debt-free. We’ve seen lots of students successfully use GoFundMe to pay off student loans. Start your student loan fundraiser today.

Start your fundraiser

Written by nicola

Crowdfunding Student Loans to Pay Off Debt

| 7 min read Crowdfunding

Have you ever thought about what life could look like without student loan debt? Maybe you could fulfill your dream of buying a home, launching your own business, or giving a family member the nursing care they deserve.

You’re not alone if you daydream about how to quickly finish paying off student loans. There are about 44 million Americans burdened by this, according to Forbes. A report from CNBC found that 60 % of borrowers don’t expect to pay off the full balance of these loans until they’re in their 40s.

But your financial future doesn’t have to look bleak. Crowdfunding your student loan debt can help you find hope and live beyond the limitations set by steep education costs.

Start a fundraiser

Why use crowdfunding to pay off student loans?

When you look into how to get rid of student loans, you might discover the options are limited. Student loans aren’t easily forgiven, even in bankruptcy. In many cases, borrowers can’t even refinance student loans at lower rates.

This is where crowdfunding comes into the picture. Fundraising your student loan debt can help reduce your monthly bill and allow you to give payment to down your principal balance faster. Many people who used this for student loans were able to avoid decades of debt. Even current students have jumped on the fundraising bandwagon, raising money for the cost of college so they can avoid debt later on.

How does crowdfunding student loan debt work?

People raise money by starting an online fundraiser that their friends, family, and community members contribute to. They then apply the donations to their student loan balances. But unlike student loan repayment, the money you receive through fundraising doesn’t have to be repaid—except in gratitude to those who have supported you. Some people even like to pay it forward to other students in need once they’re on their feet.

If you’re ready to get help paying off student costs, start by following the six steps below.

1. Pick your platform

These days, there countless fundraising websites to choose from. If you’re overwhelmed by the options, here are the key features to look for when you’re ready to start education fundraising efforts.

No platform fees for organizers

Some crowdfunding sites take a certain percentage of each donation as a fee. You’ll want to look for a fundraising site that you to keep as much of the money you raise as possible. Compare website fees by reading our blog Which Fundraising Site has the Lowest Fees.

Excellent customer support

If you run into trouble, it’s important to have a customer service team that can provide 24/7 support quickly.

Easy sharing tools

Sharing your fundraiser is one of the most important things you can do to bring in donations. You’ll want to look for a fundraising platform that makes sharing your fundraiser on social media and other mediums simple.

A reliable mobile app

If you’d like to easily manage your fundraiser on the go, a solid mobile app is important. A well-made mobile app will allow you to seamlessly make changes to your fundraiser, thank donors, and withdraw your funds all from your phone. It can also make mobile giving easy for your supporters.

A useful blog

If you need specific help learning how to raise money paying off student loans via crowdfunding, it’s always nice to have a blog with articles related to your cause. In addition to general fundraising tips, the blog should offer content related to tuition fundraising and how to pay for college through crowdfunding.

2. Create a compelling fundraiser

When people visit your fundraiser, you’ll want them to engage with your story right away. Images and videos that are clear and help you tell your story are important, but the words you choose matter just as much. Not sure where to start? We’ve put together some helpful storytelling tips in our blog post Your Fundraiser Story: A Comprehensive Guide.

3. Share your fundraiser

Sharing your fundraiser with everyone you know is the best way to maximize donations. Each time you share your fundraiser on Facebook, it will net an average of $43. You can also share your fundraiser link through emails and text messages.

For more tips on effectively sharing your fundraiser, take a look at these blog posts:

4. Keep your supporters in the loop

After you’ve started raising money, donors will be curious to know how their contributions are making a difference. Posting updates keeps supporters up to date on your fundraising journey—and this can lead to more donations and donor retention. There’s an art to writing an effective update, and we cover all the details in our post How to Write a Fundraiser Update.

5. Give back through gratitude

Everyone loves receiving thanks for a kind deed, and your donors are no different. In fact, thank-you notes are an essential fundraising tool. For some ideas, take a look at these blog posts:

See how crowdfunding student costs helped real people pay off loans

When these folks didn’t know how paying off student loans quickly and it negatively affected their lives, they turned to crowdfunding for help.

Shannon Otto Student Loan

Shannon was featured on The New York Times podcast “The Daily” when her nursing license was suspended because she couldn’t make her student loan payments. In serious financial trouble and unable to work, she didn’t know where to turn. A listener started a GoFundMe for her, but it turned out she had already set one set up—and it ended up raising more than $9,000 to help her get back on her feet.

It’s Never Too Late For Yr Dreams

Twenty years ago, Rachel dropped out of film school at UCLA when she became pregnant. Friends and advisers told her it wouldn’t be possible to raise a child while going through the program, so she started over in Alabama, becoming a university film professor.

Flash forward to the present day, and Rachel has decided to continue pursuing her lifelong dream of working in Hollywood. Aside from the political barriers to breaking into the film industry as a female director, Rachel faced financial barriers as well: a $12,000 fee to join the Director’s Guild of America, moving expenses and existing student loan debt. To offset these costs and follow her dreams, Rachel started a GoFundMe that raised over $15,000.

Crowdfunding can help you live without loans

If you’ve struggled with finding out how to finish paying off student loans, crowdfunding sites is an option worth exploring. Whether you want to fundraise proactively or you already have student loan debt, GoFundMe student loan assistance makes it easy to raise money right away.

Thousands of students have used GoFundMe to quickly finish paying off student loans and find financial freedom—are you ready to give it a try as well? Start your fundraiser today.

Start your fundraiser

Written by nicola