Before and After Debt: The Rise (and Stagnation) of Employer Tuition Payment Programs

The Familiar Issue of Student Debt

Debt, by nature, exists as an effect. It is the effect of buying something before we can truly buy it—a borrowing that can loom for a long time, growing with interest, if we do not find an effective strategy to pay it off. As many of you reading this blog know, a relatively quick and sure way to accumulate debt is by taking out university student loans. A good place to look to help fighting this debt is in your workplace. We will be looking at two prevalent means of getting help from employers, highlighting the latest information on them: loan repayment benefits and tuition payment programs.

Broadly speaking, there are two primary student debt-fighting methods. One is to act offensively, retroactively. You take out loans and get into debt, then you work to pay off that debt. The other is to act defensively. You foresee the debt that will likely come and work early on to prevent or minimize it.

Available Methods: Loan Repayment Benefit

Many businesses are trying to help with both of these debt-fighting tactics. In earlier LoanGifting blog posts, we have explained the advantages to businesses that provide student loan repayments as a benefit. This aligns with the offensive technique, where you have come into contact with debt and have chosen to fight. With this benefit, employers show awareness regarding their employees’ needs, and employees find relief from figuring out debt repayments alone.

Available Methods: Employer Tuition Payment Programs

On the defensive side of debt fighting, there may be available benefits your employer has to help pay for tuition. Recently, more companies have been incorporating employee tuition programs to assist workers in furthering their education while continuing in their jobs. This is a pay-as-you-go method, ranging from covering full tuition costs to covering small portions of the costs.

Interestingly, according to a recent Wall Street Journal article, only about 10 percent of employees to whom this benefit is available take up the offer.

There are various factors that feed into the reason for the small amount of people using these tuition payment programs. Some people do not want to go on to higher education, for example, and some people plan to wait. But the larger factor, most likely, is ignorance of the availability of these kinds of programs.

Before people can accept the help of their employers to pay for tuition, they need to know such help is offered. While companies figure out the most effective ways to spread information (and while student advocates figure out the most effective ways to prompt businesses to prioritize such clarity), we can make a point to ask our employers about these benefits. If you are fighting student loan debt, ask about a loan repayment benefit. If you have just begun or are soon to embark on a new degree, ask your employer if there is a program to financially support this decision. Certainly it would be nice if we were all carefully informed about these useful debt-fighting tools. When we are not informed, however, we can at least proactively seek out the information.

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