Dwight Holton, CEO of Lines for Life, encountered an unforeseen challenge when discovered his employees carried a collective $7.5 million in student loan debt. Concerned about the impact of America’s soaring $1.77 trillion student loan crisis on his workforce, he conducted a survey among 100 respondents, revealing an average monthly loan payment of $600. Recognizing the mental health strain linked to this burden, Holton took action. Realizing his employees lacked sufficient guidance on managing their loans, Holton engaged the Institute of Student Loan Advisors to educate his HR team and employees on the Public Service Loan Forgiveness (PSLF) program, a federal initiative benefitting certain nonprofit organization employees.
As millions of borrowers prepare to resume student loan payments after a pandemic-induced hiatus, the Biden administration launched initiatives like the Saving on a Valuable Education (SAVE) plan, an income-driven repayment option. Betsy Mayotte, President of the Institute of Student Loan Advisors, emphasized the importance for HR teams to be informed about loan repayment basics and available resources for employee inquiries.
Recognizing the pivotal role employers can play, the U.S. Department of Education initiated a campaign, supported by organizations like SHRM, to educate individuals about loan repayment plans. HR teams can tap into these resources to assist employees in navigating the complex landscape of repayment options.
Jeni Burckart, from Tuition.io, highlighted the improvements in eligibility for loan forgiveness under the expanded PSLF program, urging employers to educate their staff about maximizing loan forgiveness opportunities. However, as loan payments restart, the resurgence in queries presents challenges due to understaffed loan servicers, leading to incorrect or delayed information delivery to borrowers.
Employers looking to further aid their workforce might consider offering student loan repayment benefits, an initiative that not only alleviates financial stress but also proves advantageous for the company’s bottom line. While engaging third-party advisors can enhance the loan repayment experience, caution should be exercised regarding refinancing offers, as the best loan forgiveness options are usually linked to federal government-held loans.
Ultimately, employers investing in student loan debt assistance witness not just financial benefits but also heightened employee loyalty, as the relief offered becomes a recurring monthly reprieve from financial strain.
