According to a recent survey, 81 percent of workers are taking steps to prepare for a possible recession. These steps include paying off debt, increasing contributions to savings, and looking for a higher-paying job. Nearly half felt negative about their personal finances.

The 2022 PwC Employee Financial Wellness Survey found that financially-stressed employees are twice as likely to look for a new job, and more than one-third looking for a new job have student loan debt.

With the recent passage of SECURE 2.0, there’s growing pressure on employers to do more to help their employees pay down debt and increase their savings. Since student loan debt remains one of the largest forms of household financial stress. Beginning in 2024, SECURE 2.0 will allow employers to offer matching retirement plan contributions for employees repaying student loans.

2023 is An Opportunity for Employers to Help Pay Down Workers’ Student Loan Debt

The student loan repayment pause first implemented in March of 2020 was due to expire at the end of 2022 but was extended until the summer of 2023. During the repayment pause, interest rates are set at 0% and no payments are due. Student loan payments made during the pause are applied directly to the principal balance. This gives borrowers a chance to pay down their debt faster.

The average student loan debt balance is around $30,000, so even if the Biden Administration’s forgiveness program goes through, borrowers will still carry significant debt. Employers offering a student loan contribution program give employees an incentive to pay down their debt.

Student Loan Contribution Programs are Key to a Successful Financial Wellness Program

According to the more recent Bankrate Emergency Savings Survey, most working Americans have less than three months’ worth of expenses saved for an emergency. This includes workers who have benefited from a student loan repayment pause for the last two years.

Student loan contribution programs increase retention by giving employees a reason to stay in their current position. According to the PwC survey, 65 percent of employees cited money as their primary reason for changing jobs.

A student loan contribution program is a simple way to support financially stressed employees. Workers who feel supported by their employer are more likely to report feeling satisfied with their job.

Contact IonTuition today to set up your student loan contribution program.