Whether you’re on the hunt for a new job or content in your current one, you should know what benefits are available to you as an employee. One of the fastest growing? Employer student loan repayment programs. According to the Employee Benefit Research Institute, 25% of employers offered student loan repayment assistance in 2022. That’s a substantial increase from 2020 when just 16% of employers supplied this benefit.
How companies handle student loan repayment can vary, but if your employer offers this perk, taking advantage of it can help you save money and pay off your debt faster.
How Does Employer-Supported Student Loan Assistance Work?
Student loan repayment benefits differ from tuition reimbursement in that they provide targeted assistance to repay education debt. They can help you pay off both federal and private student loans.
Employer-supported student loan repayment can take several forms, but the three most common ones are payment matching, service-based assistance and lump sum signing bonuses.
Most companies that offer student loan repayment utilize payment matching.
With a student loan program that has a payment matching structure, the employer matches your student loan payments up to a monthly or annual maximum. For example, a company might match 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 leading example. It matches workers’ student loan payments, with a $15,000 lifetime maximum.
Companies that utilize payment matching may make the payment to the employee. Or, if they work with third-party services like Gradifi or Goodly, they may make payments directly to the student loan lender.
With this structure, an organization may pay a portion of your student loan debt in exchange for years of service working for that employer. For example, the Florida Bar Association provides up to $5,000 per year of loan repayment assistance to those employed by a civil legal aid organization.
In some fields, companies go a step further to attract workers. Employers recruiting veterinarians, nurses, physicians, and other healthcare-related professionals will often offer lump sum signing bonuses for student loan repayment.
For example, the Pet Emergency Center in Montana listed a $20,000 signing bonus and student loan repayment in recent job ads. And medical lab technicians could qualify for a $5,000 signing bonus with the Cleveland Clinic.
How to Get Help from Your Employer
With more employers offering this benefit, you may be eligible for student loan repayment assistance from your current employer.
Contact your human resources department and ask if education debt repayment assistance is an existing benefit. If it is, there may be some restrictions, such as only being available to full-time workers or employees that have been with the company for at least one year. Ask what is the criteria and process required to take advantage of this benefit.
If your company doesn’t provide this benefit yet, you can suggest they consider it in the future. They can work with services like Goodly, Gradifi, Candidly and Tuition.io to streamline the process of implementing and managing student loan repayment assistance programs.
What if Student Loan Repayment Assistance isn’t an Option?
Although employer student loan repayment programs are growing in popularity, not all companies offer it. If you aren’t eligible for student loan reimbursement from your employer, another way to manage your debt is to consider refinancing your existing student loans.
With refinancing, you could qualify for a new loan with lower rates and more favorable terms than you have now. Refinancing could allow you to save a significant amount of money and pay off your debt sooner.
Student loan refinancing has some drawbacks if you have federal loans the loans become private during the refinancing 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 impacting your credit score.