For many of the more than 43 million Americans who share more than $1.5 trillion of federal student loan debt, there’s relief to be found in the U.S. Department of Education’s Public Service Loan Forgiveness (PSLF) Program.           

PSLF was created by Congress in 2007 under the College Cost Reduction and Access Act to help attract qualified professionals to occupations in public service. The program’s mandate is straightforward: For people who have spent at least 10 years working full time in qualified fields and have made at least 120 monthly federal loan payments, the law may forgive outstanding debt on a student loan. 

Notably, the program’s loan approval rate has been notoriously low since the law was passed, a sign that many applicants still may be confused about the program’s parameters. Those who are eligible but either don’t know or haven’t applied for loan forgiveness are essentially leaving money on the table. And reducing debt is an important step on the path to long-term financial wellness. 

Whether or not you are eligible for loan forgiveness under the PSLF Program depends on if you fit the Department of Education’s explicit, detailed requirements. Here’s a close look at what determines eligibility:

Your employer matters.
As a full-time employee of a federal, state, local, or tribal government or a tax-exempt nonprofit group, you may be eligible. You can be a professor or groundskeeper—the job title is not relevant; only an employer’s status is examined under the program. 

(Note: Even people who work for a nonprofit employer that is not a Section 501(c)(3) organization may be allowable under the program, if they work in a qualifying field such as public health, education, emergency management, military service, law enforcement, library services, or public law services. Full-time volunteers for AmeriCorps or the Peace Corps are also eligible, but employees of labor unions, political groups, or for-profit government contracts are not.)

The type of loan you have matters.
Only federal Direct Loans—officially issued under the William D. Ford Federal Direct Loan Program—qualify for the PSLF program. 

If you have other kinds of federal loans, such as through the Federal Family Education Loan Program or the Federal Perkins Loan Program, you may consolidate them into a Direct Loan to become eligible for PSLF. But payments only count toward the 120 required PSLF payments after the consolidation.

The timing of your payments matters.
Payments only count during periods when you are satisfying the employment qualifications. They don’t qualify during a period when payments weren’t required, such as during a deferment or if you have qualified for forbearance, which is when payments are temporarily reduced or suspended due to hardship.

Keep in mind that the 120 payments don’t have to be consecutive, and you can’t speed up the process by making bigger monthly payments over a shorter period.

All payments must be made for the full monthly amount owed and submitted prior to 15 days after the due date of your bill.

Your repayment plan matters. Make sure you are using an eligible repayment plan. PSLF only considers borrowers making payments under income-driven repayment plans, which calibrate monthly payments to income to make loan repayment manageable.

Repayment plans that do not qualify are the Standard Repayment Plan for Direct Consolidation Loans, Graduated Repayment Plan, Extended Repayment Plan, or Alternative Repayment Plan.

The primary reasons applications are rejected are that loans aren’t being repaid under a qualified repayment plan, information is missing about an applicant, or the loan is not a Direct Loan and is therefore ineligible, according to the Department of Education.

If you believe your application for loan forgiveness under the PSLF program was wrongfully denied or you realize you need to supplement your application with more material, you may be able to submit an appeal under the Temporary Expanded Public Service Loan Forgiveness (TEPSLF) program. This appeals process has an approval rate in excess of 6%.

Every day, approximately 10,000 people celebrate their 65th birthday, according to the U.S. census. By 2030, when all baby boomers have reached that milestone, 18% of the country will be 65 or older, according to Pew Research Center's population projections.

Reaching 65 is one thing; being ready to retire is another matter. Here's what you can do to gradually get in gear when you're 10 years, five years, and one year from retirement.

10 years

A decade may seem like a lifetime, but it's surprising how fast it passes. If you haven’t already, now is when you'll want to get real about your retirement timeline if you haven't already.

√ Check your vision. Maybe you had a vision for retirement that you set some time ago. Consider what's changed that may require rethinking your goals. At this point, what kind of life do you want to live in retirement? How will you spend your time? Will you downsize your house? Relocate? Travel frequently?

√ Do the math. Will you have enough assets or cash flow to retire? Figure out how much income you will need and then get organized. List all assets and liabilities—in particular, retirement accounts and other savings and investments. What you'll want to see is a snapshot of your portfolio and savings rate that will help you build a diversified retirement income plan that will last your lifetime. This snapshot of your future finances will help you anticipate what your portfolio could do for you during retirement. As a general guide, many people aim to live off 4% of the value of their portfolio at retirement. Some say an even safer strategy is to ensure that your retirement assets will cover your fixed expenses in retirement.

√  Play catch-up. If you discover a shortfall, create a plan for filling it. For example, find ways to generate more income with a side hustle or a weekend job, and then devote the proceeds solely to retirement savings. Saving even modest amounts of money this far ahead of retirement can pay off in significant ways, given the power of compounding.

√ Do important paperwork. Make sure you have established estate planning documents, such as a will and power of attorney. To be honest, these are good things to do after you land your first job, certainly once you become a parent.

Five years

With retirement in your sight, it's a good time to streamline your spending and begin moving your money into position.

√ Clean up debt. The less debt you have in retirement, the better. Prioritize debt reduction and, ideally, eliminate it, and develop a strategyOpens in a new window for getting it done gradually over the next five years. One approach is to pay off your highest-interest credit card first while paying the minimum on the rest. Once that debt disappears, concentrate on the next highest-rate card, and so on.

√ Tighten spending. Review your budget and make tough choices now for a more worry-free time in retirement. Maybe it's time to limit food delivery to one night a week or decrease your streaming services from three to one. Also, look at which bills you can reduce—perhaps you can negotiate a better rate on your cell phone or cable service (it never hurts to ask). Not only can you put that extra money toward goals like paying down debt, but having lower expenses heading into retirement will serve your budget well.

√ Review your asset allocation. As you get closer to retirement, you may need to adjust your investment portfolio for risk management. Take advantage of any catch-up provisions in your retirement plans to increase your contributions, if you can.

√ Estimate future income. Get an updated estimate of your Social Security income based on your actual earnings using the Retirement Estimator on the Social Security Administration's websiteOpens in a new window. While you're there, log in and retrieve your statements.

√ Give yourself a reality check. Revisit your timeline and weigh how comfortable you feel retiring in five years. If you're drowning in debt or are recovering from a setback like a spouse's job loss, you might feel more confident if you put it off a year or two.

One year

You're in the home stretch. Some days you're likely excited, and other days you're anxious. Exhale. You still have steps to take and time to do them.

√ Make a plan for Social Security. One of the biggest decisions you will make in retirement is when to take Social Security. It is no time for guessing: Consult a financial advisor about your options and what makes sense for you. Know that if you decide to hold off, you can revisit your decision every year until you reach maximum retirement age (70).

√ Create a diversified income strategy. A diversified mix of income sources can provide for a more sustainable long-term income in retirement. Consider a plan where you meet about 2/3 of your expenses with income from Social Security and other guaranteed fixed income sources, like a pension. The remaining third of your income needs could be met with the purchase of equal amounts of fixed and variable lifetime income products. Including fixed and variable lifetime income options can help you better address the unique risks faced in retirement and generate monthly income payments you can't outlive. 

√ Combine your retirement savings. If you have multiple accounts gathered over years of working, consider consolidating all your 401(k) and IRA plans. 

√ Do a dry run. You've already reduced your spending; now take the next step and test drive your retirement budget to see how doable it is. 

√ Boost your reserves. Consider a part-time job or side hustle to stash extra cash in your emergency savings.