“According to Make Lemonade, there are more than 44 million borrowers who collectively owe $1.5 trillion in student loan debt in the U.S. alone. The average student in the Class of 2016 has $37,172 in student loan debt,” sites a June 2018 Forbes article.

Furthermore, check out the consumer debt picture (this is separate from student loan debt) in America from Business Insider:

The debt issue is a problem on so many levels, but for employers, it is impacting thoughts and decisions about what a desirable benefits package looks like in order to recruit and retain employees.

Is the savings piece of your benefits plan, most likely in the form of a 401K, even desirable anymore?  Can your employees even think about saving if they don’t ever see a way out of debt?

In addition, the financial stress your employees face is costing you money.   According to Forbes:,   “Across all generations — Millennials, Gen X, and Baby Boomers — financial matters were the top cause of stress. Forty-six percent of workers spend three hours or more during the work week thinking about or dealing with financial issues, and 47 percent said their finance-related stress has increased over the last 12 months. And according to a new survey from Bankrate, which interviewed 1,003 adults earlier this year, 57 percent of Americans don’t have enough cash to cover a $500 expense.”

So what should you do?  There are three routes/benefits I would suggest you consider to address the debt equation in your overall benefit plan:

1. Student Loan Repayment.   Offer your employees the benefit of paying off their student loans. Some companies do this as a simple benefit with no strings attached, but most require some length of service requirement in order to be eligible to receive this benefit.

Here is a list of some companies that are doing it and how they are doing it: Nerd Wallet.

A company that facilitates this benefit for employers and that I have heard good things about is gradifi.

2. Acting a money lender/payday advance.   Companies are cropping up that help employers act as lenders to their employees through payroll advances and other arrangements.  Some arrangements charge the employee a flat fee while others charge an interest rate on the money borrowed.

Wal-Mart is advancing employee’s wages in this way through a company called PayActiv.

More on this subject from the Wall Street Journal can be found here.

3. Offering Financial Wellbeing Training.  While the first two options are designed to offer access to capital to pay off debt, many employers are focusing on training employees to be better managers of their finances in order to reduce and eliminate debt.  This seeks to solve the problem in the long run by changing behavior instead of putting a band-aid on it.

If this interests you, check with banks and/or credit unions in your area. Many offer free classes. In addition many employers offer the popular Dave Ramsey Financial Peace training to their employees at no charge.

How can you improve your benefit offerings to address the debt issue?