27 May 2006

For more information on shrinking school loans, see Paying For School and Find Funding Opportunities.

New grads who want to change the world often find that fighting poverty begins at home, as they contemplate their first measly paycheck and Kilimanjaro-size student loans. One solution: With assistance programs that repay student loans in return for work in underserved areas, you can do good and still make a big dent in that debt.

Brian McDonald's first job out of college, with a bank in Rochester, N.Y., followed a traditional career path in corporate finance. But when he was laid off several months later, he made a radical switch and became an AmeriCorps volunteer in Albuquerque.

McDonald, 24, worked for a nonprofit organization that makes microloans to low-income entrepreneurs, primarily minorities and women. During his yearlong stint, he earned a stipend of less than $10,000. But thanks to AmeriCorps' loan-repayment education awards, he still managed to pay off 25% of his $19,000 in student loans. Afterward, he began a career in community-development finance with the federal government.

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