Gain a Competitive Edge - Student Loan Repayment and College Savings Benefits Programs
In the United States, education is key to economic prosperity. 85% of adults with a college degree earn $65k/year compared to $35k/year for those with only a high school education. 80% of parents see a college degree as the key for their children to open the doors to opportunity, establish a career, and achieve financial security. A bachelor’s or advanced degree is viewed as the cost of admission to the workforce, but the skyrocketing cost of education is putting that price out of reach.
In conversation with our friends, Melissa King, Vice President of Marketing, and Andy Bessette, Manager of Partnerships, at Gradifi, an industry leader in employer student loan repayment, refinancing, and college savings program solutions, they shared somber statistics about education related debt and the stress on today’s workforce. 69% of bachelor’s degree graduates leave school with a median of $26,500 in debt and one million parents take out loans each year, to send their children to college. There are more than 44 million borrowers who collectively owe $1.5 trillion in student loan debt in the U.S., according to Make Lemonade .
On an individual level, the burden of student loan debt is obvious . It affects decisions about buying cars, houses, starting a family, and when 44 million Americans are putting a high percentage of their monthly income towards student loan repayment, they aren’t spending on other economy-boosting goods or services. Student loan borrowers also have less money to save and invest.
Employers are dependent on an educated workforce and they are already feeling the pinch of the tight labor market. Employers are having to get creative to keep their best talent as there are approximately three million Americans who leave their jobs voluntarily, each month. Deloitte’s 2017 Millennial Survey tells us that 44% of Millennials intend to find a new job within the next two years.
Given these circumstances, employer sponsored student loan repayment and college savings benefit programs are increasingly appealing to working professionals. Research suggests that offering a student loan repayment benefit would have a meaningful impact on recruiting, referrals and employee retention. Student loan repayment benefits are a hot topic among HR and benefits professionals as it is relatively new on the scene and can serve as a differentiator for organizations in a competitive labor market.
Ultimately, employers who are able to help their employees manage their student loan debt and save for college have an opportunity, according to Oliver Wyman, a global management consulting firm, “to distinguish themselves by directly addressing one of the biggest unmet financial needs in the lives of working professionals.”
Come join us on January 30th to meet representatives from Gradifi and to learn more about offering student loan repayment and college savings benefit programs to your employees.