Many employers are now helping millions of their employees deal with their student loans and the massive debt that comes with it. There has been an increase in the interest of many companies towards helping their employees pay for their student loans. Although the number of companies currently offering this perk is quite low, it sure is expected to grow with time.
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Let’s talk about this Perk that a few companies have started offering
Your employer helping in paying your student loan debts is referred to as Employer Student Loan Benefits. In this type of benefit, employers help their workers pay back their student loans in multiple ways, as decided by the employer. Many companies have started using this benefit as a way of retaining and attracting new talent, especially millennial workers who are particularly more interested in this benefit owing to the massive student loan debt that plagues most of them. The ever increasing student education debt has helped this benefit program grow even further. According to the Washington Post, there has been a threefold increase in student loan debt since the early 1990s.
Notable companies that have started providing this benefit include Fidelity Investments, Kronos, Natixis Global Asset Management, NVIDIA, PricewaterhouseCoopers, and law firm Orrick, Herrington & Sutcliffe.
Companies usually work with a vendor to deliver these payments. The main vendors include CommonBond, PeopleJoy, Peanut Butter, Leaf Education Benefits, Tuition.io, Gradifi, SoFi, and EdAssist.
Employer student loan contributions are taxed as regular income, unlike tuition reimbursement benefits, which are tax-free up to $5,250 annually. There have been many proposals in the Congress regarding employer student loan contributions and on making them tax-free.
How are these benefits provided?
Until now, only 8% of companies have employer student loan repayment benefits, but that is still an increase from last year’s 4%, as per a survey by the Society for Human Resource Management.
A survey conducted by CommonBond in 2018 found workers, especially younger ones, are more inclined to accept and stay at a company that provides such benefits.
Employers have a wide spectrum of methods to help their employees. The benefits can range from direct student loan contributions to programs that help employees understand the best way to repay their debt. Direct payments as benefits are scarce because they are the most expensive Some employers will match the retirement contributions to employee student loan payments, whereas others permit workers to trade their remaining paid time off for student loan contributions.
List of the Top 10 Companies providing these Benefits:
Give it some thought before you make up your mind
There is no doubt that the Employer Student Loan Contributions Program is a perk that can be beneficial for a lot of students who are under Student Loan debt and are looking for companies that can help them get out of this burden.
Though one thing to keep in mind is that these benefits are still considered as a taxable income source, leaving you to pay taxes on the benefits being provided by your employer.
The congress passing a proposal to make these benefits tax-free in the future would really help out millions of employees and to-be graduates.
Though you don’t just have to rely on these benefits to get the best deal for your education. Turn to the Best Student Loans for more information.