Do you recall the tale from the previous year about the man who ran a crowdfunding effort to raise funds to create potato salad? It may sound absurd, but his Kickstarter initiative attracted close to 7,000 participants and raised more than $55,000.
While some twentysomethings are using crowdfunding sites to ask for assistance in repaying their student loans, this isn’t all that surprising given that 69 percent of graduates have debt and owe an average of $28,400 per borrower, according to The Project on Student Debt. Crowdfunding sites still receive their fair share of (ahem) creative fundraising requests. What’s even more alarming? the finding from a 2013 study by the One Wisconsin Institute showing repayment times for borrowers with undergraduate degrees range from 19.7 years on average to 23 years for those with graduate degrees. It follows that graduates are looking for novel solutions to lessen the considerable burden.
If you approach a crowdfunding campaign correctly, you can get a lot of strangers to contribute to your education costs. The place to begin is here.
Know how to use crowdfunding websites
Student debt postings are permitted on numerous websites, but each one operates differently and has different guidelines and costs. Finding the one that best fits your particular scenario requires investigation, which is why it’s crucial.
Piglt enables “dreamers” to build video campaigns that persuade “believers” to make a gift against current or future educational expenses or amassed student loan debt.
Fees: For loan and tuition initiatives that are completely funded, Piglt charges dreamers a 5% fee. Additional “third party transaction fees” are charged at a rate of 3%. Any funds received for loan campaigns that fall short of their goal are the dreamer’s to retain, but they are subject to an 8 percent fee.
GoFundMe, one of the more well-known crowdsourcing platforms, hosts fundraising for schools (among other types). Even if their objective isn’t reached, users keep every dollar donated.
Fees: Registration is free, but each donation is subject to a 5% deduction. In addition, 3% will be deducted for processing.
By offering financial support in exchange for volunteering, ZeroBound promotes involvement in the community. The source of a student loan is directly credited with the funds raised.
Fees: A 5% fee is assessed to campaigns that meet their fundraising targets. Those that fail keep any money they make, but they must pay an 8 percent fee. Additionally, each donation carries a transaction fee of $0.30 and a processing fee of 2.9 percent.
One of the first platforms for crowdsourcing was Indiegogo. its current offshoot Users of Indiegogo Life can raise money for some of life’s toughest issues, such as college tuition.
Fees: Since debit and credit cards are the only payment methods accepted by Indiegogo Life, there is a transaction fee of 3% + $0.30 for third-party processors.
Make the most of your contributions
The first step is deciding which crowdfunding platform to utilize. You now need to develop a compelling campaign and spread the word. But how exactly do you do that?
- Make a video or write an article explaining why you require assistance with your student loan. Give specifics, but avoid making your story so drawn-out and boring that potential donors give up before the finish.
Create a hashtag for your campaign and use it whenever you post on social media about it.
- Maintain communication with your donors by writing a blog. It can include information regarding your college experiences. Or perhaps it links to recent news stories regarding the difficulties associated with student loan debt.
- Set a sensible objective. If you ask for too much, you risk coming across as ungrateful. Alternatively, donors might feel powerless and be less motivated to give.
- Deliver updates. Use your crowdfunding page and social media profiles to inform people about the progress of your campaign since they want to know how things are going.
- Keep it succinct. Campaigns for the most successful crowdfunders often run just four to six weeks.
Although it’s still uncommon, crowdfunding for student loans can be a simple way to pay off some (or all) of your debt.