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The New Employee Benefit: Help Paying Off Student Loans
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By: Teri Bernstein

 

Students who teach in challenging urban areas or doctors who practice medicine in remote areas have historically been able to get help from their employers (usually local governments) in paying off their student loans. That employee benefit is being introduced to the private sector by companies that operate as third-party managers of this perk. 

 

Gradifi is one such company.  It has placed ads directed at employers, telling them that the reason students have accumulated so much debt is that they "wanted to work for you." PricewaterhouseCoopers (the Big Four accounting firm, known as PWC) was Gradifi's first client.

 

It turns out that millennials (who are healthy and far from retirement) find very useful a benefit that will help them pay down their student loans by matching the payments they have to make RIGHT NOW. According to Tim DeMello, CEO of Gradifi, “the millennial workforce will be 50 percent of the workforce by 2020, and 75 percent of them graduate with student loans.” And student debt now totals $1.4 trillion. The potential for growth seems apparent.

 

Source: "The new workplace perk: help with student loans," by Amy Scott, Marketplace: American Public Media, November 8, 2017.

 

Discussion: 

  • What employee benefits interest you the most and why? Consider repayment of student loans, health care, vision and dental care, vacation time, personal and sick leave, defined benefit pension plans or 401(k) plans with employer matching, child care leave, on-site child care, flexible scheduling, ability to work from home, office or cubicle surroundings, on-site workout areas, on-site masseur/chef/barista, product discounts, professional development training, self-development training, technology freebies or loans (phones, tablets, laptops), business car, business class travel upgrades, expense accounts or entertainment expense reimbursements.
  • How important is salary vis-a-vis benefits?
  • Describe the tax law change that would make the student loan benefit more attractive. Would this be possible under the tax bill currently being proposed by Republicans in Congress?