Whether you’re looking for a new job or happy with your current one, you need to know what benefits are available to you as an employee. One of the most dynamic? Employer student loan repayment programs. According to Employee Benefits Research Institute25% of employers offered student loan repayment assistance in 2022. This is a substantial increase from 2020, when only 16% of employers offered this benefit..
How companies handle student loan repayment can vary, but if your employer offers this benefit, taking advantage of it can help you save money and pay off debt faster.
How does employer-sponsored student loan assistance work?
Student loan repayment benefits differ from tuition repayment in that they provide targeted assistance to repay student debt. They can help you repay federal fees and private student loans.
Employer-supported student loan repayment can take many forms, but the three most common are payment matching, service-based assistance, and lump sum signing bonuses.
Most companies that offer student loan repayment use payment matching.
With a student loan program that has a matching payment structure, the employer matches your student loan payments up to a monthly or annual maximum. For example, a company can make up to $100 per month in payments up to a lifetime maximum of $10,000.
Fidelity Investments, which added its student loan repayment program to its benefits package in 2021, is a prime example. It corresponds to student loan repayments by workers, with a Lifetime maximum of $15,000.
Companies that use payment matching can make the payment to the employee. Or, if they work with third-party services like Degraded Or Beautifulthey can make payments directly to the student lender.
With this structure, an organization can pay off some of your student loan debt in exchange for years of service with that employer. For example, the Florida Bar Association provides up to $5,000 per year in loan repayment assistance to individuals employed by a civil legal aid agency.
In some areas, companies go further to attract workers. Employers who hire veterinarians, nurses, doctors and other medical professionals often offer lump sum signing bonuses for student loan repayment.
For example, the Montana’s Pet Emergency Center listed $20,000 signing bonus and student loan repayment in the latest job postings. and medical lab techs could qualify for $5,000 signing bonus with Cleveland Clinic.
How to get help from your employer
With more employers offering this benefit, you may qualify for student loan repayment assistance from your current employer.
Contact your human resources department and ask if student loan repayment assistance is an existing benefit. If so, there may be some restrictions, such as only being available to full-time workers or employees who have been with the company for at least one year. Ask about the criteria and process required to take advantage of this benefit.
If your business does not yet offer this benefit, you can suggest that they consider it in the future. They can work with services like Beautiful, Degraded, Frankly And Tuition.io streamline the process of implementing and managing student loan repayment assistance programs.
What if student loan repayment assistance isn’t an option?
Although student loan repayment programs from employers are growing in popularity, not all companies offer them. If you don’t qualify for student loan repayment from your employer, another way to manage your debt is to consider refinancing your existing student loans.
With refinancing, you may qualify for a new loan with lower rates and more favorable terms than you currently have. Refinancing could save you a significant amount of money and pay off your debt faster.
Student Loan Refinance has some drawbacks if you have federal loans, the loans go private during the refinance process, so you won’t be eligible for federal loan benefits, but it can be a smart way to manage high-interest debt.
And, with College Ave, you can check your refinancing options without affecting your credit score.