Student Loan Repayment Benefits Package
Student Loan Repayment Benefits Package. Millions of students graduate each year with student loan debt and struggle to make ends meet. Thankfully, there are employers out there hungry for talented new graduates and are willing to entice them by offering a generous student loan repayment benefits package. But what is a repayment benefits package, how does it work, and which companies offer it? Will these packages save students from the need to compare personal loan rate or seek additional refinancing options? Here’s what you need to know.
What is a student loan repayment benefits package?
A student loan repayment is an incentive or benefit offered by an employer to attract talented new graduates to join their ranks.
How does It work?
A student loan repayment benefits package works by offering employees with student loan debt repayment assistance as part of their overall benefits package. The CARES Act helped further promote this as a benefit by making up to $5,250 of repayment benefits excluded from income, which eliminates the need for a personal loan or a refinancing option.
A company will typically offer a student loan repayment benefits package in the form of a reduction in their employees’ monthly student loan payments by having the company send a direct payment to the lender on their behalf or as tuition reimbursement or funding for education-related expenses for employees who are currently enrolled in school.
What are the advantages
If your employer offers such a lone, it can be an easy and affordable way to pay down your student loan debt. Second, it can help you stand out in the job market as a valued employee. Finally, it can provide you with valuable education and career resources.
On the company’s end, offering student loan repayment benefits can be a way to attract and retain top talent. Many employees appreciate the opportunity to reduce their monthly student loan payments and are more likely to stay with a company that offers such a benefit than an employer that doesn’t. In addition, providing student loan repayment benefits can help the company save money on employee salaries and benefits over time.
What Are The disadvantages
If your employer offers it, there are a few critical disadvantages to participating in a student loan repayment benefits package.
First, receiving monthly direct payments from your employer on your behalf can be confusing and challenging, especially if you’re already juggling other financial obligations. Second, if your employer goes out of business or you leave the company, you may lose your student loan repayment benefits altogether. Third, if you decide to switch jobs, it may be difficult to transfer your student loan repayment benefits to the new employer.
4 companies that offer student loan repayment benefits
SoFi
SoFi is an online lender that offers a wide range of financial products and services. The company began offering a $200/month student loan repayment benefit for employees in 2016.
Hulu
The online streaming service began its student loan assistance program in 2018 and matches up to $1,200 of each employee’s student loan debt payments every year.
Fidelity
Fidelity offers repayment assistance of up to $2,143/year and a $15,000 lifetime maximum to employees who work at least 30 hours per week. Employees who work 20 – 29 hours are eligible for $1,071 in assistance per year and a $7,500 lifetime maximum.
Estee Lauder
While many companies featured are in the tech or financial industries, cosmetics conglomerate Estee Lauder is one of the few outside the industry that recognises the benefit of employee student loan debt assistance. They offer $100/month to eligible employees with a lifetime maximum of $10,000.
The bottom line
Paying student loan debt doesn’t have to be something you tackle alone.Talk to your human resources department to see if your company offers anything similar.
