What if every time you ordered a spicy tuna roll or tried a new craft beer, you could set aside an extra dollar or so to put toward your student loan debt?

It’s a strategy that might work for many millennials. A new app, for example, allows Fifth Third banking customers to link their debit cards to student loans held by more than 30 major loan servicing firms.

You could agree to round up that $8.35 for lunch to $9 on your debit card and throw an extra 65 cents toward your student loans. Or round up the purchase to $9.35 and throw a dollar toward your debt.

Sure, anyone can put extra change and loose bills in a jar at night, count it up each month, take it to the bank and then write an extra check toward student loan debt. But who’s going to feel great doing that drudge work?

Fifth Third said its research indicates that millennials want an app to make them “feel better while saving them money.”

Smart finance apps are all about offering immediate solutions that fit easily into a consumer’s lifestyle and makes the most of that mobile moment.

“It’s budget friendly,” said Nick Sky, 29, a founder of ChangEd, an app that was introduced this year to help borrowers throw their spare change at student loan debt.

“We’re solving our own problem, and we’re really passionate about helping people,” Sky said.

Sky and his partners in the Chicago-based startup owe more than $100,000 in student loan debt in total.

Many savings-related apps exist, but the new twist is having apps that target a specific challenge, such as student loan debt.

Here’s a look at some of the apps and rewards for paying off student loan debt:


Fifth Third rolled out its Momentum app this month

Once a loan is connected to a Fifth Third debit card, customers can choose to round up their debit card purchases to the next dollar or add $1 to every purchase.

You cannot use the app to make extra random payments. It’s only a tool for rounding up those debit card purchases. Once $5 in payments is accumulated, the money is automatically sent to the student loan account at the end of the week.

The app allows a college graduate’s family members to use it, too. They can sign up their own Fifth Third debit cards to pay down the student loan debt.

One concern: If you end up using that debit card far more often than usual, you would need to pay more attention to your balance so you don’t record overdrafts.

Fifth Third estimates that customers who round up $25 a month using this app could pay off a 20-year student loan three years sooner and pay 8 percent less overall by avoiding extra interest that would have accumulated. The numbers are based on a loan amount of $37,172 with a fixed interest rate of 6.8 percent.

Someone who is on a 10-year repayment plan would see a savings of about 2.3 percent, according to Mark Kantrowitz, publisher and vice president of strategy for Cappex.com.

Kantrowitz said that in general, borrowers should try to repay their student loans within 10 years to aim for bigger savings in interest.


A loyalty program called Upromise by SallieMae offers cashback rewards that can be used toward paying down eligible student loans.

You would need to sign up for the free account and make purchases at specific retailers, travel sites and online stores.

Only the borrower can link Upromise and student loan accounts, and not all student loans are eligible. See Upromise.com/loanlink for details. Upromise account balances of $10 or more will be automatically transferred on a monthly basis to the linked student loan account.

Other options

Several lenders and loan servicing companies offer mobile apps that can help you manage student loan payments.

ChangEd, for example, works with the round-up system on purchases. There is an iOS App at the App Store but not an Android version yet.

Sky said about 3,000 people so far have signed up to use ChangEd — which is able to connect to accounts at a wide group of banks and credit unions.

The extra pennies and dollars that you round up get transferred to an FDIC-insured ChangEd account. ChangEd charges a $1 fee each month that’s taken out of the balance that has built up to pay off student loan debt. Once $100 is accumulated in change, ChangEd sends a payment for your loans.


Tompor writes for the Detroit Free Press.