Student loan assistance is the benefit every millennial wants but few businesses are offering.
In a saturated job market it’s hard to compete with top companies who offer lots of shiny benefits. In today’s changing workforce, job seekers are looking for companies that better align with their own values rather than looking for the highest-paying job. While pay and compensation are certainly still important, there are other benefits you can offer that will attract top talent without jacking up salary offers. Some of the most sought-after companies are now offering student loan repayment and college savings assistance programs.
With American student loan debt reaching a staggering $1.5 trillion, employers can no longer ignore the young workforce (millennials) who are searching for help left and right. A recent study shows that 25% of employees report issues with finances have been a distraction at work. 43% of those who are distracted by finances at work spend 3 or more hours each week thinking about or dealing with issues related to personal finances. Those who report they are distracted due to finances might begin to seek work at another company who can better serve their individual financial needs.
Recognizing outside financial burdens of employees will help reduce turnover and create higher senses of satisfaction and loyalty.
A study from 2018 reported 86% of employees would commit to a company for five years if the employer helped pay back their student loans. Research shows less turnover results in higher profits for business and overall better work culture. Considering a student loan repayment/college savings program can help you attract and retain top talent while increasing productivity, employee engagement and employee happiness.
What should business owners look for in a student loan assistance benefit?
Before jumping into offering any sort of repayment assistance program, assess your budget and see if you have room to sustain this offer. Remember that offering student loan assistance to employees will ultimately benefit you, the business owner, in the end.
If you determine that a student loan benefit can be offered, start seeking a company to partner with. When searching for a student loan assistance program you might start by asking yourself a few questions:
- How much can I spend per employee per month?
- How much can I offer per year before it’s counted as taxable income for the employee?
- Does this program help with future tuition and college savings in addition to existing loan debt?
Aliat partners with Gradifi to offer student loan repayment, college save up, and loan refinance benefits to small and midsized businesses.
Here at Aliat, we have become the first PEO on the West Coast to partner with Gradifi to assist our team with their educational financial burdens. Gradifi is an industry-leading student loan repayment olution for employers who are looking to offer this unique benefit to their employees. Programs offered by Gradifi include:
- Student Loan PayDown. Perhaps the most popular student-centered financial benefit, this program is designed to help alleviate existing loan debt. Gradifi helps set up a customized dashboard for your company which shows employer contribution and allows employees to add and manage existing loans.
- College SaveUp. Many parents do not feel financially prepared to send their children to college. Gradifi can help employees save for their children’s future college tuition expenses. Working similarly to the PayDown program, the employer can add a contribution each month.
- Gradifi ReFi. Gradifi also offers loan refinancing options through First Republic Bank, Lend Key and Earnest. Refinancing can help lower payments to make them more affordable.
Gradifi’s program is easy to set up and navigate. The employer has little to do, as Aliat will take care of the administrative set-up for each employee. Once you decide on a contribution amount and the employee is in the system, they have freedom to personalize and add/manage their student loans on Gradifi’s user-friendly dashboard. If the employee is utilizing PayDown for student debt and has more than one loan, they can even choose which loan they would like to make payments towards first. It’s never been easier to implement.
Investing in your employees’ financial future will certainly help drive employees to invest in you.
When an employee feels their financial needs are met, they are inclined to have better productivity, lower rates of presenteeism and lowered stress levels. Remember, this will benefit the business and the business owner in the end too.
At Aliat we believe in a holistic approach to making a healthy business. Request a consultation with one of our Business Advocates to learn how you can create more financial, physical and mental wellness for your employees and build a healthier business from the inside out.