Student debt help could be a new worker perk with loan payments resuming soon
Student debt help could be a new worker perk with loan payments resuming soon
The athletic brand Adidas announced earlier this month that it’s going to help its employees in the United States with student loans pay back their debt. The company noted that a majority of their employees here say student debt causes significant stress, so it’s clear that it’s top of mind.
This kind of program isn’t new, but it’s also not common: About 8% of employers in the country offer it, according to a survey out this week from the Society for Human Resource Management. With student loan payments set to resume in October, this could become a more common perk.
There are approximately 43 million people in the U. S. with federal student loan debt, and they want to know which employers will help them pay it off.
“More and more frequently, I’m hearing from borrowers who are asking me if there’s a list,” said Betsy Mayotte, president of The Institute of Student Loan Advisors.
There’s no official list of employers, but those who do offer some sort of benefit see it as part of competing for talent in a tight job market.
Like Adidas, the exercise company Peloton offers employees $100 a month toward student debt, said Michael Gettlin, vice president of global total rewards for Peloton. Peloton’s had the benefit since 2017, he said.
“Anything that could weigh on a team member is important to us. And this is a very significant part of that for a large portion of our workforce,” Gettlin said.
As an alternative to helping pay down debt, Peloton offers employees with dependents who might someday go to college the same amount of money toward educational savings.
Craig Copeland with the Employee Benefit Research Institute said he’s heard from some companies that offering benefits related to student debt, as opposed to the cash equivalent, led to better staff retention.
“Because it kind of anchored them to, ‘I’m getting this money to do something very specific, pay back the student loan,’ where if I just give them money, then people don’t tie it to either the employer or to paying off the debt,” he explained.
But not every worker has student debt, and some have other priorities, said Emily M. Dickens with the human resources trade association SHRM.
“We’ve heard that cash is one of those things that people care about. And flexibility is No. 2,” Dickens said.
While employers might not offer money to pay off loans, Mayotte noted there are other ways to help employees, like offering counseling on how to better manage debt.
“Employers are a trusted voice for most of their employees. So it’s a really effective communication channel,” Mayotte said.
And it’s one we’re in front of pretty much all the time.
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