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Employers are Now Including Student Loan Repayment Among Company Benefits

Certain companies may have figured out a way to retain Millennial employees — by including loan repayment as part of their business’ benefits package. According to The New York Times, Fidelity is one of the first companies to offer this benefit: “Under the student loan repayment program, Fidelity will apply up to $2,000 a year […]

Employers are Now Including Student Loan Repayment Among Company Benefits

Certain companies may have figured out a way to retain Millennial employees — by including loan repayment as part of their business’ benefits package.

According to The New York Times, Fidelity is one of the first companies to offer this benefit:

“Under the student loan repayment program, Fidelity will apply up to $2,000 a year — or nearly $167 a month — toward an employee’s student loan principal, up to $10,000 total. More than 5,000 employees, or about 11 percent of its work force, have signed up since January. Tuition.io, a company based in Santa Monica, Calif., collects the payments and sends them directly to the loan servicers. It also gives workers guidance on which loans to pay off first.”

And this couldn’t be coming at a better time. Currently, New York Magazine estimates that Americans have accrued a terrifying sum of $1.2 trillion in student debt. After spending hundreds of thousands of dollars to obtain a degree, Millennials are now scrambling to find positions that will help them get out of the financial hole they willingly got themselves into. Such a benefits plan will certainly appeal to these individuals.

Portrait Of Multi-Cultural Business Team In Office

According to calculations conducted by Tuition.io, these benefits could contribute in a big way. Typically, benefits can take off as much as 30% of a person’s salary. If an employer were to put forth $100 a month to an employee with $35,000 in student loan debt with a 6% interest rate over the course of 10 years, then the employee could help reduce “at least $2,213 in interest, and shave 2.5 years off the repayment period.”

Fidelity is not the only organization adding these benefits. PricewaterhouseCoopers, Natixis Global Asset Management, and Nvidia have also announced plans to offer payments. Even smaller companies like Chegg and ChowNow are providing these benefits, too.

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