Student debt has reached dramatic levels and the numbers keep growing -- along with the stress and anxiety for those struggling to pay it off. The average student loan balance is $30,000, up from $10,000 in the 1990s. And while average undergraduate student borrowing has increased 60% since 1990, average undergraduate parent borrowing has tripled.How can employers help ease the financial stress weighing on their employees – both the recent grads and the parents stuck paying these overwhelming amounts? A student loan assistance program is a smart place to start.
Mercer’s Healthy, Wealthy and Work-Wise study found that 70% of employees say the benefits they receive at work help relieve their financial anxiety. Student loan debt can strain an employee’s ability to stay focused at work and negatively affect their mental health. A 2017 survey from American Student Assistance reveals that 86% of employees ages 22 to 33 would commit to a company for five years or more if they helped to pay off their student loans, and 92% of employees from the same survey would take advantage of a student loan payment match program if offered. These programs not only help with peace of mind, but may also keep employees from shortchanging – or even tapping into -- retirement accounts.
Student loan assistance is also an effective way for employers to attract top-performing talent and stand out from competitors. It’s part of a larger trend to leverage voluntary benefits to address employee financial needs. Check out this Employee Benefit News story for more on this important topic -- stay tuned for our next post on financial wellness trends.