Economic Impacts
Nearly 73% of Millennials, 62% of Gen X, and 50% of Baby Boomers with student loan debt have delayed at least one major life or financial milestone, as a result they’re unable to engage in financial milestones like purchasing a car, buying a home, or having children. (Bankrate - opposing image)- A $1,000 increase in student loan debt can cause a 1-2% drop in home ownership, according to the Federal Reserve Board. (Fox)
- 53% of millennials haven't purchased a home due to student loan debt either disqualifying them or making it impossible to afford a mortgage. (Education Data)
COVID's Impact
3.2 million new federal student loan borrowers and an unemployment spike fueled the biggest increase in total student loan debt since 2013. (Education Data)- 79% of student loan borrowers have challenges that will impact their ability to pay once the CARES Act suspension period ends (e.g., unemployment, underemployment, illness, deferment, etc.). (Ascendium)
- Total student loan debt increased 8.28% in 2020; while average student loan debt increased 4.5%. (Education Data)
- Only 50% of those who had lost their job during the pandemic had secured a new position. (Vox)
- 62% of employers in 2020 (up from 13% in 2013) feel extremely responsible for their employees’ financial wellness. (Bank of America)
- 11.2% of adults with student loan debt said they were unable to make at least one student loan payment year-to-date, reported in July 2020. (Education Data)
Financial Stress In the Workplace
4 out of 5 employers say employees' personal finance issues impact job performance. (IFEBP)- 49% of struggling employees reported suffering from stress, anxiety or depression over the past 2 years, compared to just 16% of employees with no financial worries; and, only 39% of struggling employees were fully engaged at work. (Willis Towers Watson)
- 53%+ Americans agree that thinking about their finances makes them anxious. (US Financial Capability)
- 38% of employees have less than $1,000 saved to deal with unexpected expenses. (Price Waterhouse Cooper)
- Financially stressed employees are 3X more likely to be disengaged than their counterparts. (Willis Towers Watson)
- Financially stressed employees miss 2X as many days a year compared to unstressed peers. (ADP)
- 67% of Millennials and 32% of Baby Boomers said their financial stress hinders their focus and productivity at work. (Bank of America)
- 76% of Millennials, 68% of Gen X and 57% of Baby Boomers said they’ve used financial services provided by their employer to assist them with their personal finances. (Price Waterhouse Cooper)
- 47% of Millennials are afraid they'll be unable to meet their families’ basic financial needs when they retire. (Transamerica Center for Retirement Studies)
- When asked what causes the most stress, 54% reported financial or money matters/challenges. (Price Waterhouse Cooper)
Financial Wellness in the Workplace
80% of employers (from large and small companies) believe employee financial wellness programs help produce employees who are more loyal, productive, satisfied, and engaged. (Bank of America)- 47% of Gen Z and Millennial employees feel there is a lot more their employer can do to support overall holistic well-being (financial, physical, mental). (Bank of America)
- 83% of HR professionals say financial stress in employees has a negative impact on work performance. (SHRM)
- Financial health programs have been shown to reduce absenteeism, improve productivity and lower health care costs. (ADP)
- Nearly 50% of organizations rate their workforce as not at all/only a little bit financially savvy. (SHRM)
- 62% of employers feel extremely responsible for their employees' financial wellness, up from 13% in 2013. (ebn)
- 69% of employees who were given access to 4 or more tools and resources (the most) reported their finances were headed in the right direction versus 51% who had no access to tools and resources. (Willis Towers Watson)
- 64% of employees with the most access reported being encouraged to improve their financial situation versus 40% with some access. (Willis Towers Watson)
- 75% of millennials, 75% of Gen S and 85% of baby boomers say they have a good understanding of employer benefit and savings plans and the role those plans play in their overall financial well-being. (Price Waterhouse Cooper)
- 83% of employers believe financial wellness tools lead to greater productivity. (Bank of America)
- 56% of employers offer tuition assistance in the form of reimbursement, which is tax-exempt for employees up to $5,250/year. (SHRM)
Student Loan Delinquency & Default
First-generation college students are 2X as likely to report being behind in making student loan payments. (Education Data)- 1 out of 5 student loan borrowers experience student loan default and its life-long consequences. (PEW)
- Consequences of default can include high collection fees, wage garnishment, credit score damage, withholdings from income tax refunds and Social Security. (PEW)
- The default rate among Black graduates is more than 5X the rate of White counterparts. (Brookings)
- 25% of student loan borrowers default within the first 5 years of repayment. (Education Data)
- 78% of the borrowers who have defaulted owe $40,000 or less. (Education Data)
- 30% of Black college graduates with student loans default within the first 12 years of repayment. (Education Data)
Borrowers Need Support
40%+ of workers said the most valuable resource their employer could provide to help them reach their financial goals, would be advice from a financial professional. (Bank of America)- 51%+ student loan borrowers say they did not estimate monthly payments when obtaining their most recent student loan. (US Financial Capability)
- 52% of student loan borrowers who are satisfied with their loan servicer(s) go elsewhere for loan information. (Ascendium)
- $26.9 million of the $700 million allocated for Public Service Loan Forgiveness (PSLF) program was approved by the Department of Education. (Education Data)
- A little over 1% of PSLF applications have been approved since the program’s inception. (Education Data)
- 25%+ of the US labor force is in public service; 3 million are eligible to apply for PSLF, but just over 200,000 have applied. (Education Data)
- 79% of student loan borrower respondents said they would utilize a trustworthy and established student loan counseling service if one was offered by their school, bank or employer. (Ascendium)
- 52% don't know what their monthly payment will be once the CARES Act suspension ends; 33% don't know what repayment plan they'll use; and, 63% don't know how to implement an alternative plan. (Ascendium)
- 33% of first-generation students quit college within 3 years. (Hechinger Report)
Attract & Retain Employees
The number of US employers offering student loan assistance has doubled since 2018. (SHRM)- 40% of Millennials say they're "somewhat committed" to their employer. (ReportLinker)
- 35% of Millennials and 27% of all other age groups have turned down job offers due to dissatisfaction with the benefits (Anthem)
- 55% of Millennials and 35% of workers in general rank student loan repayment assistance as a top demanded employee perk (Unum)
- 80% of Millennials would strongly consider a job with a student loan repayment benefit over one without it. (Forbes)
- 86% of employees with student loans would commit to a company for 5 years if the employer helped pay back their student loans. (SHRM)
- 70% of employees with debt said student loan benefits would improve their work performance. (US News)
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62% of Millennials are more likely to say their company loyalty is influenced by how much the company cares about their financial well-being; as compared to Gen X (50%) and Baby Boomers (36%). (Price Waterhouse Cooper)
- 72% of Millennials and 71% of Gen X are more likely than Baby Boomers (45%) to be attracted to another company that cares more about their financial well-being. (Price Waterhouse Cooper)
