Employers looking to keep pace on benefits should keep a close eye on student loan repayments.
Thanks to new legislation, the benefit could see a 300% increase.
That according to a CNBC story earlier this year detailing recently approved legislation around student loans. The new COVID Relief bill allows for employers to contribute up to $5,250 annually toward employees’ education debt without having to pay taxes.
“Prior to the crisis,” wrote CNBC citing a 2019 SHRM survey, “around 1 in 10 employers offered a student loan benefit.” With the benefit of tax-free payments wrote the CNBC author, the number could rise to 1 in 3.
The surge in popularity is just one of the reasons employers will want to pay attention.
What are 3 others?
Much-needed relief: $1.6 trillion in debt is a known drag on financial wellness, and so job performances. Current financial insecurities only exacerbate the effect, making today’s per-capita amount –$30,000, a record high – especially painful.
Sizable impact: Even nominal employer contributions toward principal can cut years off a loan, imparting confidence that a debt-free future is achievable.
Exceptional value: Shorter loans translate to less interest, saving Bright Horizons client employees $10 million in interest in 2019 alone.
If that’s not enough – there’s that 300% increase in the number of employers about to offer it.
“Student loan assistance was already finding its way into the mainstream menu of workplace benefits,” wrote CNBC.
“The pandemic may only accelerate the trend.”
That means there may be no time like the present.
An Employer’s Guide: The COVID-19 Relief Bill & Student Loan Repayments
Join our 2/23 webinar to learn how new legislation will affect adoption of student loan repayment, and the benefits of offering these programs to your employees.