What if we told you a potential employer is offering to help you pay off your student loans? Would it significantly sweeten the deal?
Of course it would. And the benefits are mutual – you get to pay off your student loan debt faster and your employer retains a valuable member of the team. And yet, there’s a good chance that many of you reading this have never heard of an employer that helps to pay off student loans for its employees. Why aren’t more companies getting involved with employee student loan repayment programs?
There are a few answers to this, and the simplest is money. Many companies aren’t willing to spare the additional dollars. Although student loan repayment does carry weight in wage and salary negotiations, there are many employers who fear that a formal employee student loan repayment program could bleed company funds.
However, more and more employers are coming to realize they cannot ignore the growing number of millennials in the workforce. They also cannot ignore the needs of employees – and for millions of millennials, repaying student loan debt is a great need indeed. That’s why more companies are adding student loan repayment incentives to their employee benefits.
Fidelity Investments is one of the latest entrants into the field. The company is offering the new Student Debt Employer Contribution program to interested employers. The program helps companies make after-tax contributions toward employees’ student loan debt. As Fidelity Investments sees it, the program is attending to an ever-growing need that touches everyone struggling with student loans, across generations. Kevin Barry, the president of Fidelity Workplace Investing, says “Employers turn to Fidelity as a trusted strategic partner, and it’s vital our customers have modernized, customized and creative programs to help their workforce be financially well today and into the future.”
The full roll-out of Fidelity’s program begins in early 2018. It’s likely that more companies around the country will tackle employee student loan debt head-on in the coming years, but with more than $1.4 trillion in total student loans, the sooner the better.