Education Funds (Income Share Agreements): Who Qualifies and What You Get
Learn how these funding agreements work, how much you might pay back, and the risks of paying a percentage of your future salary.
Education Funds, also known as Income Share Agreements, provide funding for your studies that is repaid through a portion of your future earnings rather than fixed interest payments.
Who it's for
This funding is typically available to students enrolled in specific academic fields, such as STEM (science, technology, engineering, and mathematics), Law, or Business.
What you get
Instead of a traditional loan with fixed monthly payments, you receive flexible funding to cover your costs during your studies. Once you begin working, you repay the fund by paying a set percentage of your future salary for a specific period.
What it costs you
While you do not pay interest in the traditional sense, you enter into a contractual obligation. This means you are legally required to pay back a portion of your salary for several years once you are employed.
The catch to know
The most important thing to understand is that because you are paying a percentage of your income, the total amount you eventually pay back can be significantly higher than the original amount of funding you received.
How to apply
- Research different private providers to see which ones offer agreements for your specific field of study.
- Review the contract carefully to understand the percentage of income required and the duration of the payments.
- Check if your specific degree program is eligible under the provider's terms.