Biden Launches New Student Loan Repayment Program

Kathryn Mayer By Kathryn Mayer August 24, 2023

​Following the Supreme Court's decision earlier this summer to strike down the White House's previous student loan forgiveness plan, the Biden administration this week announced another program in an effort to help make student loan payments more affordable.

The plan, called Saving on a Valuable Education (SAVE), is a revamped income-driven repayment (IDR) program that calculates payment amounts based on income and family size. It also allows borrowers who consistently make their monthly payments to see their debt forgiven after a certain number of years. The administration projects that it will help more than 20 million American borrowers.

As of Tuesday, borrowers can begin enrolling at

SAVE replaces the Revised Pay as You Earn Repayment Plan (REPAYE), an IDR plan, and borrowers who are currently enrolled in REPAYE will be transferred to SAVE. Their monthly payments will be adjusted before student loan payments restart in October.

The SAVE announcement is an opportunity for HR professionals to share the news about the program with their employees—many of whom are struggling with substantial student loan debt, said Dan Macklin, president of Summer, a New York-based financial services firm.

"Providing this information is a great way to help employees with student debt achieve financial goals," he said. "Previous income-driven repayment programs from the government with lower thresholds and higher minimum payments had very low enrollment rates, partially due to poor knowledge circulation about what programs were available to which student loan holders."

Student loan debt has been a significant struggle for many employees, and attention to the problem has slowly been gaining traction in the workplace as employers have realized the toll it takes on employee productivity and the stress it can produce. As a result, several organizations have implemented student loan repayment benefits.

It's a popular notion: Data from Betterment at Work found that 57 percent of employees think companies should help their employees with student loans, with 85 percent saying they would leave their jobs for one that offered student loan benefits.

The SAVE program announcement also is an opportunity for HR departments to set up their employees for success in the program, Macklin said. Employers that offer student loan benefits should recirculate the benefits offered to employees to make sure employees are enrolled in the programs an employer is involved with. Especially helpful are tools to help borrowers enroll in programs such as IDR and Public Service Loan Forgiveness.

And for employers that don't currently offer student loan benefits? "This is a good opportunity to look into benefits programs that help with elements like enrollment in government aid programs," Macklin said, "including major programs expected to debut in January 2024 like the employee student loan payment retirement matching program available through the SECURE 2.0 Act."

"For employers whose employees are eligible for SAVE, making sure they actually access the program should be a top priority to ensure employee mental and financial well-being as well as retention," Macklin added.

SHRM Online gathered up additional news on student loan debt and the workplace.

Supreme Court Strikes Biden’s Student Loan Forgiveness Plan

The new SAVE program announcement comes roughly two months after the Supreme Court struck down Biden's student loan forgiveness plan. The high court ruled 6-3 on June 30 to strike down the Biden administration's plan—a decision that could put a spotlight on student loan benefits offered by employers.

The Biden administration announced last year that the federal government would repay up to $10,000 in student loans for borrowers who earned less than $125,000 annually and up to $20,000 for those who received Pell Grants. But two cases—Department of Education v. Brown and Biden v. Nebraska—contested his plan, resulting in the court hearing the issue in February.

Industry experts contend that the ruling highlights a need for additional support in tackling student loan debt and could spur a rise in student loan benefits in particular.

"To recruit and retain a first-class workforce, employers need the flexibility to offer benefit packages that fit the needs of their employees. Educational assistance is one such tool," according to a statement from SHRM.

(SHRM Online)

Student Loan Debt Remains a ‘Pain Point’ for Employees

Numerous surveys have found that student loan benefits are highly desired by employees, but only about 8 percent of U.S. employers provide student loan repayments to eligible employees—a percentage almost unchanged over five years, according to SHRM's 2023 Employee Benefits Survey.

While the appeal for job candidates is obvious, such a benefit can be used by employers as a recruitment, engagement and retention tool. Fidelity Investments, which offers its employees a student loan benefit, for instance, found that attrition rates among employees participating in its program are 78 percent lower than for its employee population at large. Among new hires, half said the student loan repayment benefit was a major factor in their decision to join the company.

(SHRM Online)

Adidas Rolls Out Student Loan Benefit for Full-Time Employees

Adidas, which has roughly 10,000 U.S. workers, announced in June it is joining the small but growing cache of employers offering a benefit to help employees tackle student debt.

The sports apparel company is now offering its full-time employees $100 a month—totaling $1,200 a year—toward their student loan debt. Employees can apply for the new student loan repayment benefit after being employed at Adidas for one year.

"This is an exciting new program for our people who said that student loan support would significantly help them," Rupert Campbell, president of Adidas North America, said in a statement. "Paying for education should not hold our teammates back, so we are happy to support them with this benefit."

In addition to the student loan benefit, Adidas also launched a financial wellness program, offering employees free access to various financial resources such as financial coaches, seminars and webinars. The majority of Adidas employees with student loan debt say they are experiencing financial stress, according to the company.

(SHRM Online)



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