​New Relief Plan's Impact on Student Loan Repayment Benefits

11% of Employers Will Be Revisiting Strategy

BROOKFIELD, Wis.— President Biden's student loan relief plan is affecting employers' considerations for student loan repayment benefits, according to a new survey report from the International Foundation of Employee Benefit Plans.

Eleven percent of employers report they will be revisiting their strategy for student loan repayment benefits. Almost 60% of employers said they will not be changing their current policies, and 31% said they are unsure of plans to change repayment offerings.

Only 9% of responding U.S. employers currently offer student loan repayment benefits; 74% are not offering the benefit at all, and 16% are not currently offering but are considering adding a student loan repayment to their benefits package.

Program Structure

For employers offering student loan repayment benefits, a variety of approaches were cited:

45% pay the employee's lending institution directly, rather than providing extra compensation to the employee

28% reported reimbursement or direct payment to the employee

21% said they offer refinancing of student loan debt

3% reported providing a corresponding "match" into the employee's 401(k) or other defined contribution account.

Recruiting, Retaining, and Building Talent

Student loan repayment benefits have been slowly gaining popularity over the past few years, giving many organizations a leg up throughout challenging labor markets. When asked whether their student loan repayment offerings have been successful in achieving workplace goals, employers responded that they have been successful in:

• Retaining staff – 45%
• Reducing staff financial stress – 45%
• Attracting staff – 31%
• Increasing staff engagement – 24%.

Challenges

The most common challenge faced by employers offering or considering student loan repayment benefits is perceived unfairness amongst employees (resentment from employees who do not benefit from student loan assistance, for example). This was reported by over half (52%) of employers. Other challenges include financial and administrative burdens.

Visit www.ifebp.org/studentloans for more information and a copy of the full report.

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The International Foundation of Employee Benefit Plans is the premier educational organization dedicated to providing the diverse employee benefits community with objective, solution-oriented education, research and information to ensure the health and financial security of plan beneficiaries worldwide. The Foundation has more than 31,000 multiemployer, corporate and public sector members representing over 25 million lives. For additional information, visit www.ifebp.org.