A new report released by Guardian entitled, “College Debt in America: The Case for Tuition & Loan Repayment Benefits,” found that 7 out of 10 parents plan to use a part of their retirement savings/investments to pay for their children’s college education. Last year, families spent an average of $26,458 on college and covered half of the expenses with income and savings. Parents alone contributed nearly $9,000 to their children’s education. One-third of parents with children who took out student loans share the responsibility of making payments on that debt.

Planning for, saving for, and repaying a child’s college education is a family effort. Both the students and parents play a role, yet not much can be expected from the student given the low earnings available to teenagers and the high tuition prices. Today’s parents feel more pressure to save for their children’s college education than previous generations.

Employees Are Struggling to Save for Both Retirement and College

To young workers, retirement seems unreachable considering how little employees in their 30s have saved compared to how much experts recommend they have. Fidelity recommends that the average 35-year-old has twice his or her annual salary saved for retirement (which according to BLS would be around $100,000). According to the Economic Policy Institute, the average retirement savings of Americans between 32 and 37 is $31,644.

Meaning the majority of the workforce is way behind on their retirement. Millennials and Gen Xers have been facing an uphill battle since they graduated college. Baby boomers are staying in the workforce longer, limiting opportunities for the next generation to fill management positions. Gen Xers are starting to send their children to college and are realizing quickly how unprepared they are for the costs, forcing many to cash in part of their retirement. Thus causing them to stay employed longer and perpetuate this vicious cycle.

One Financial Benefit to Rule Them All

Finance is like a deflated balloon. Relieve pressure on one area only to feel squeezed in another. Those parents that were able to save for retirement weren’t able to save for their children’s college. Millennial parents have an even more arduous challenge. They need to pay down their college debt, save for their children’s college education, and contribute to their retirement – a feat not easily done.

Companies that relieve the stress from one financial area enable employees to fulfill their other fiscal responsibilities. Fresh college grads aren’t thinking about their retirement, let alone their children’s college education. They’ll jump on job offers with companies offering to help repay their student debt.

Start your employees off right by offering a student loan benefit so they’ll have their debt under control when it comes time to plan for their future. Reach out to the IonTuition team today to see how you can make a difference in the lives of your workers.