The average student loan debt is at an unprecedented $37,172.
College grads entering the work force would value student loan repayment assistance as a job benefit over additional vacation time, according to a recent survey conducted for the website Student Loan Hero.
The Wall Street Journal reports that the Class of 2016, about 70 percent of whom borrowed for their educations, is entering the work force burdened by an unprecedented student loan debt of $37,172, up from last year’s $35,000. On the plus side, there is a growth in starting salaries for college graduates at more than $43,000.
But that student loan debt is burdensome enough that companies, including Pricewaterhouse Cooper and Fidelity, are offering repayment help as a job benefit for their Millennial employees.
In general, employers annually pay or reimburse employees a specific amount paid toward their student debt. PwC, reportedly will pay up to $1,200 for a total of six years, while financial firm Natixis Global Access Management will pay a $5,000 lump sum to its employees who have been with the company at least five years and $1,000 on every work anniversary up to five years, according to Student Loan Ranger, a blog on the U.S. News & World Report website. The benefit is not as yet tax-free.
How important would this job perk be to college graduates? According to the Student Loan Hero survey, almost 22 percent of respondents would consider it extremely important, 17 percent very important and 23 percent just moderately important. Respondents ages 18-24 were more likely to choose “very important” than 25-34 year-olds (23 percent vs. 13 percent).
But a 401(k) retirement plan employer match would be a higher priority for job-seeking college graduates (54 percent vs. 46 percent). They also consider a health care plan or insurance benefit to be a more preferable job benefit that student loan repayment assistance (76 percent vs. 24 percent).
When surveyed as to whether they would prefer student loan repayment assistance or additional vacation/paid time off, the largest percentage said they would prefer the debt repayment assistance (53 percent vs. 37 percent).
Almost two-thirds of respondents (64 percent) indicated that would use their employer’s debt repayment assistance to make an extra payment toward their debt. Just over one-third (36 percent) said they would use it to cover part of their current monthly payment.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.