Do you help graduating college students find their first job? As a college career counselor, you should encourage them to look at more than just their degree and salary when considering a career.
As a college career counselor, you have a tough road ahead. Although the job market is improving, it is still challenging to place Millennials in their first job after college.
Additionally, employees are concerned about the work ethic and communication skills of this generation, and graduating students are faced with the reality of student loan payments after graduation.
While it may feel intrusive to dig into the student debt of the graduates you counsel, you may actually harm their career prospects if you don’t take these financial concerns into account.
Five ways to help students with student debt choose careers
1. Encourage students to consider careers that help pay down debt
71 percent of college students graduate with student loans, and the average debt — as of the class of 2014 — is $33,000. The debt will be easier to pay back for those that majored in higher-earning fields like engineering, or for those that didn’t have to borrow extensively.
But for those that took on a pile of debt for a low-earning degree such as history, it may well be a challenge to support that debt after the student graduates. Knowing about their debt load allows you to consider alternate routes like graduate or law school, which can convert a low-earning degree to a high-earning degree… even if it means more loans.
2. Know if students are at risk for future credit problems
Getting a graduate their first job out of college is a great start, but if their debt load is out of proportion with their salary, the graduate may struggle with their payments. This may result in credit problems, which could cost them their job if good credit or a security clearance is required. It could also prevent your student from getting future employment.
To combat this, consider discussing Income Based Repayment (IBR) and Pay As You Earn (PAYE) so they can get more affordable payments before their grace period ends and before they start their new job.
3. Help students look at jobs beyond their major
If the graduate has more debt than a position in their career field will support, it’s time to give them a reality check about how they need to prioritize their debt during their job search. (Click here to tweet this advice.) After all, federal student loans have no expiration date and could haunt them to their grave.
Encourage them to do whatever is necessary to pay down their debt, including choosing IBR or PAYE, taking a job outside their field or even considering a part-time job on top of their full-time position. Once the student deals with their debt, they can exercise more freedom in the jobs they apply for in the future.
4. Steer students towards the military or civil service
You should also know the amount of loans burdening graduates you counsel so you can suggest military or civil service to those with considerable debt. These jobs come with one great benefit: Public Service Loan Forgiveness (PSLF).
PSLF is a newer program which offers tax-free forgiveness of student loan balances after 10 years of payments while working in a qualifying full-time military, government or public service position. The graduate will get the most from this benefit by combining it with IBR or PAYE to minimize payments. After the debt forgiveness, the student can always alter their career path.
Of course, this isn’t always the best fit for the student, but when it’s a possibility, it’s worth exploring.
5. Offer extra emotional support
A study by the Brown Center on Education Policy found that more than half of students underestimate their debt. Because most students don’t know the extent of debt they’re in until student loan exit counseling, they may be shell-shocked by the time they get to you — and this can be a distraction during the job search process. If you are open with graduates you’re counseling about their student loans, you can create a framework to constructively address the pressures of their debt within their job search to help them make smart choices that allow them to pay off their debt responsibly.
It may feel strange at first to talk about finances during career counseling sessions, but you’ll be discussing this topic anyway since salary is another topic to consider. Rather than scrambling to make loans fit the job one of your students want, discuss student debt first so this aspect of your students’ financial lives fall naturally into place during their job search.
Rachel Rowan Stamper is the lead writer for Hloom.com, a resume template firm. She spent a decade in HR staffing in the recruiting industry before becoming a freelance writer and has written for Tuition.io and was syndicated on Business Insider.