Student loan repayment benefits are some of the fastest growing non-health employee benefits. They address the burden that student loan debt places on today’s workforce and help employers compete for top talent while saving on recruitment and retention costs. Student loan repayment benefits allow employers to make contributions toward an employee’s student loans or retirement account, reduce their financial stress, and improve workplace productivity and affinity.
Types of Student Loan Repayment Benefits
Student loan repayment benefits can take many forms. You can customize your student loan benefits with one or more of these programs to meet the strategic goals of your business and maximize your impact on your employees.
- Make contributions to employees’ student loans.
- Provide student loan counseling and educational support.
- Facilitate employee student loan payment per payroll deduction.
- Support matching student loan contributions to a retirement account.
Learn more about student loan repayment benefits and how Attigo by Ascendium can help you create your ideal benefits package.
Let’s take a look at some of the best practices for implementing student loan repayment benefits for your employees.
1 Survey Your Workforce
While student loan debt may seem like an issue for recent college graduates, it’s a burden that can be carried by anyone at any age. Older employees may still be paying their own debt or helping their children through Parent PLUS loans. Conduct surveys or gather data to assess how many of your employees carry student debt, what types (federal vs. private), and their average balances. Identify high-need populations (e.g., recent grads, early-career professionals, parents of college-age children, or employees in high-demand fields like healthcare or tech).
2 Design Your Strategy
Before you implement your student loan repayment benefits program, take time to consider how you can use it to align with your business goals, like increasing retention, improving employee productivity and morale, or standing out in a competitive job market.
- Define clear goals with measurable objectives so you can track your success and adjust as needed.
- Identify key elements early, such as budget, program administration needs, eligibility requirements, participation goals, and return on investment.
3 Strategically Align with Existing Benefits
Position the student loan benefit as part of your broader financial wellness offering.
- Consider offering student loan repayment benefits alongside 401(k) matching (e.g., using the SECURE Act 2.0 provision to contribute to retirement accounts based on student loan payments).
Not All Student Loan Benefit Programs Are the Same
Be sure to consider the financial and program management costs carefully when creating your student loan repayment benefit strategy. Some programs require little effort on your part and some can be more time-consuming to manage. Likewise, some programs like counseling typically have a cost-effective entry point that encourages widespread utilization while others, like employer contributions, can be directed to a specific subset of your workforce. Check out our free e-book for more considerations to make when setting up your benefits program and how a third-party vendor like Ascendium can provide turnkey solutions.
4 Understand Legal & Tax Requirements
Work with your legal team or benefit consultants to ensure proper documentation and tax treatment for each student loan benefit type you include in your benefits package.
- Familiarize yourself with IRS guidelines.
- Ensure employer contributions are part of a written Educational Assistance Program (EAP).
5 Communicate Clearly and Consistently
Emphasize the company’s commitment to employee wellbeing and financial stability to boost awareness and participation.
- Use internal communications and vendor-provided templates to promote the program.
- Highlight employee stories and milestones.
- Incorporate into onboarding, open enrollment, and company-wide events.
Simplify Your Process
A well-structured student loan repayment benefits program can be time-consuming to manage, but it doesn’t have to be. You can partner with Attigo by Ascendium to ensure your program is running smoothly with minimal effort on your part. Our solutions can be used individually or in tandem to tackle every aspect of student loan distress. We bring 55+ years of experience, know-how, and industry insight. You can feel confident putting your valued employees in our trustworthy hands.
How We Help
- We’ll help you manage qualified employer contribution payments to loan servicers and troubleshoot any issues.
- We provide data reporting to support your compliance efforts for student loan matching.
- Our easy, efficient onboarding with communication resources encourages program utilization.
Learn more ways Attigo by Ascendium can help you create and manage your ideal student loan repayment benefits program.
This article is provided for informational purposes only. Be sure to consult with tax, legal and human resource professionals for guidance on how to adhere to all legal requirements.
