As the average student loan debt continues to climb, a survey shows that the majority of young employees want employers to help pay off their college loans.
As the average student loan debt continues to climb, a new survey shows that the majority of young people entering the workforce want employers to help pay off their college loans.
Iontuition Inc., a company that helps students manage education costs, surveyed 1,000 people planning to attend, currently enrolled in or recently graduated from a university. The survey found that 75% said they would prefer to work for a company that offers a benefits package with a student loan repayment match.
Furthermore, many respondents said they preferred help with student loans over traditional employee benefits. More than half, 55%, said they would rather have the amount they are paying for health care go toward paying down their student loan. Nearly half, 49%, preferred a loan match over matches for a 401(k) plan.
Results of the survey come at a time when student loan debt is at a new high. Members of the class of 2014 graduated with an average student loan debt of $33,000, according to an analysis of National Center for Education Statistics data by Mark Kantrowitz, the publisher of web sites about planning and paying for college. That’s nearly double the amount of debt graduates from 20 years ago carried, even after adjusting for inflation.
Despite mounting loan debts, more students than ever are taking out loans to pay for higher education. About 70% of 2014 graduates with bachelor’s degrees left school with debt, up from less than half of graduates in 1994, according to Kantrowitz.
While the survey showed strong support for loan repayment benefits, only some employers offer them. Employees of a government agency or nonprofit designated as tax exempt by the Internal Revenue Service may be eligible. Certain teachers, nurses, doctors and lawyers also might qualify for loan prepayment programs.
Offering loan matching would benefit employers seeking to hire recent graduates, especially in highly competitive fields, said Iontuition. The Illinois-based company has developed a platform for businesses to incorporate into their regular benefits package.
Even if an employer doesn’t match loan repayments, experts say getting a college degree using loans is still a smart bet. A good rule of thumb, Kantrowitz said, is that students borrow no more for their education than the salary they expect to make upon graduating.
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