NEW YORK, April 18, 2022 (Newswire.com) - For anyone with student loan debt, which is currently about 43 million people in the U.S., May is going to be an interesting time. On May 1, default collections for student loans will resume after taking a pause during the pandemic, that is unless the government decides to continue the pause.
Student loan debt is a burden that college graduates carry for several years after leaving school. Getting help with paying off their student loans is now one of the key objectives when searching for that first job out of college. Employers know this and many of them have implemented student loan payment assistance programs.
But if the President decides to not resume the pause there are other options for student loan borrowers. There is a chance an employer may have a student loan assistance program in place. It is worth asking about that before reviewing student loan debt consolidation options. Employees can also petition their employers to implement something if a program doesn't already exist at your workplace. Here are some of the most compelling arguments to support that:
1. Employee Student Loan Payments are Tax Deductible
The CARES Act of 2020 made employer contributions to student loan payments tax deductible up to $5,250 per year. Prior to that, a company could only deduct tuition reimbursements. An employer should know that they can either pay that money to Uncle Sam or use it to help employees pay off their student loans.
2. Your Employer's Competitor's Already Offer It
This one requires some research but many employers have student loan payment programs in place, but not all of them. Check the company's competitors to see if they offer it and use that as an argument to get a similar program implemented.
3. Offer Long-Term Commitment for Student Loan Payments
This is a simple exchange. Offer your employer a long-term commitment in exchange for student loan payment assistance. Estimate the cost of replacing the employee and use that along with the reasoning that having a student loan payment program in place will help attract new talent to the company, making them more competitive in a tough labor market.
4. Financial Stress Increases Company Health Care Costs
Harvard University and Stanford have both done studies in recent years showing that workplace stress increases healthcare costs by 5% to 8%. Student loan debt causes stress for so many people. Higher stress levels lower worker productivity, another reason the company should do whatever they can to alleviate it.
5. Take the Initiative and Map Out How to Do It
The best way to close a deal is to remove all the pain points for the prospect. A boss may turn you down if the program seems like too much work to put in place. Find a vendor that provides the service for them, like SoFi or Commonbond, and map out how to set up the new program. Make it easy for them and your odds of success are much better.
The Pitch: There are Several Incentives to Doing This
There are several incentives for your company to implement a student loan payment program. Contributions are tax deductible, competitors are already doing it, employee retention will be better, health care costs should go down, and you're willing to set it up for them. That sounds like a pretty good deal. Present it like that and you might just get the help you need.