CAREERS NOW 09-02-09

No Job and Can't Pay Student Loan Debt

DEAR JOYCE: After a season of Dust Bowl-dry employment drought following my degree in international relations, I decided to get practical and obtained a second degree in education to become a teacher. My husband has a Master's of Arts degree and worked in a low-paid retailing job until the store closed. The problem is that, after earning two degrees, I have $100,000 in debt and no job. My husband's student debt load is $85,000 and he has no job.

I have applied to school districts everywhere without success. After a six months' grace period, Sallie Mae calls and calls, demanding I repay my loan -impossible to do when you're unemployed. I understand I could pay $150 to put my account into "forbearance" for six months, if I had the $150. What can I do to dig out of my educational debt mess? -- A.M.

You don't mention parents or a rich uncle and I'm not aware of any fairy godmothers ready to dash in with a Big Save, but here are a few ideas for your ghastly dilemma.

1. Immediately become expert on the new federal Income Based Repayment program (IBR) and see what it can do for you.

IBR became available in July. It can help borrowers keep their loan payments affordable with payment caps based on their income and family size. According to the Web site ibrinfo.org, most repayments will be less than 10 percent of income, even less for borrowers with low earnings. IBR also forgives remaining debt, if any, after 25 years of qualifying payments. IBR is available to anyone with federal student loans, whether past, current or future.

Visit ibrinfo.org for details. Also view moneyinformant.com; search for "student loan debt."

2. Ask around for a free or low-cost credit counselor. A call to an experienced private sector financial planner may produce referrals.

DEAR JOYCE: I took a job offer with a year-old start-up. The product looked good and the company president told me the company had deep resources. The job was a good one for nearly six months. Then everything went south and the company folded. I don't know yet how much damage that bum decision will cause to my future career. How can I avoid being suckered into a losing company again? - J.E.

My guess is that you were so relieved to get an offer that you didn't make a robust due diligence effort. Look on the bright side: you could have squandered many more months in that fiasco. The sooner you stumble, the more time you have to catch up.

The start-up's president told you what you wanted to hear and may have believed the assuring words. So you messed up- it happens.

Now roll up your sleeves and do a much tougher detective job on checking out your next offer. Start with the Net, looking for "how to research a company." The problem is that most jobs are in smallish firms and the facts may not be easy to uncover.

DEAR JOYCE: The real reason that I quit a $28-an-hour job a year ago is because my idiot boss kept writing me up for asinine reasons. I'm getting asked why I quit a $28-an-hour job. I don't know what to put down on applications as reason for leaving. I know you're not supposed to knock your previous boss. What should I say? - C.W.

The usual reasons - to spend full time looking for more challenge, opportunity and better pay - are dead on delivery, in your case. Try this:

"Life is too short for me to be controlled entirely by money. I have lots of skills to offer, and I woke up one day and realized that I want to use my skills in a happy environment where everyone works as a team to get the right things accomplished." In an interview, add a question, "Have I found that place here?"

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