Student Debt Is Back: A New Mandate for Total Rewards Leaders

BY Jessica Swenson | July 28, 2025

With college tuition up over 1200% since 1980 and dramatically outpacing inflation rates, the U.S. is in the midst of a student debt crisis. More than 42 million Americans carry a combined $1.7 trillion in student loan debt, forcing many to delay key life milestones such as buying a home, saving for retirement, and starting a family.

In just the last five years, the government has launched and revoked various programs to ease the burden of student debt holders through payment pauses, reduced interest, and potential forgiveness opportunities. With the new administration’s enforcement of the payment on-ramp end date and elimination of popular repayment plans, student borrowers now face new barriers to reconciling their debt.

“Ninety percent of borrowers [experience] heightened anxiety because of their [student loan] debt,” said Jon Harold, SoFi at Work’s head of sales and partnership success. Harold led a thought leadership spotlight on the subject during From Day One’s July virtual conference.

According to a 2024 benefits survey, employees with student debt are more concerned about it than other expenses like food, healthcare, housing, and transportation costs. This anxiety can impact workforce productivity, engagement, and retention, Harold says. “Fifty-six percent of employees spend three or more hours per week at work thinking about their finances,” he said.

There is some good news, he says. Section 127, an educational assistance program that allows employers to offer tax-free tuition reimbursement contributions up to $5,250, was expanded to include student debt payments, and the reconciliation bill recently passed by Congress extends that program permanently. Additionally, the SECURE 2.0 Act passed in 2022 allows employers to match student debt payments as if they were retirement contributions and deposits that match into the employee’s retirement account, says Harold. 

Jon Harold, SoFi at Work’s head of sales and partnership success, shared stats and insights on the subject (company photo)

To attract top talent and drive retention, many employers have started offering these types of programs as a part of their benefits package. With 62% of private-sector employees stating that student debt influences their employment decision-making, and “36% of employees with student debt less likely to remain with their employer than those without debt,” said Harold, “we’re seeing it become table stakes for many new employees out of college.” 

What are these companies doing, and how? Harold says that they are taking advantage of not only the government-enabled structured support programs, but launching their own direct-contribution programs and partnering with companies like SoFi at Work to offer education, advice, and alternative payment options.

WTW found that 42% of employers are considering participation in retirement match contributions enabled by the SECURE 2.0 Act to help employees tackle their student debt while still contributing to retirement savings. And a study conducted by the Employee Benefit Research Institute (EBRI) showed that 34% of companies offer some kind of direct-contribution model to help offset employee student debt. Employers can customize these models based on multiple factors, including budget, frequency, and employee eligibility, says Harold.

Since 86% of employees say they would stay with an employer for five or more years if the company helps with student loan debt, per a 2017 American Student Assistance survey, Harold says that a tiered program that increases contributions over time can also strengthen loyalty and boost retention. One of SoFi’s healthcare clients created a monthly direct-contribution program and saw a 21% increase in therapist retention within six months of its launch. 

Due to the uncertainty around student debt repayment plans and credit impacts, SoFi has seen a high demand for webinars, guides, and personalized advice. People are confused about what payment or refinancing options are available. “We did a webinar in June of this year where the head of our financial planning team talked about [the] changes, and it was a record webinar for SoFi. We had thousands of people sign up,” Harold said. 

Certified Financial Planners or other specialists can provide employees with one-on-one support and advice based on their specific situations, he says, and SoFi also offers optimization tools that help borrowers understand what is available and make the best choice based on their debt profile and financial needs. A SoFi partner that launched their program less than five years ago has since seen over 400 employees optimize $54 million in student debt.

“The government is incentivizing employer action and reducing support directly to borrowers,” said Harold. As this crisis deepens, employees are in a state of anxiety and confusion but also ready to act. Offering student loan benefits will give employers a strategic advantage in the talent marketplace, and SoFi is ready to share their decades of experience to help companies make the best decision for their workforce.

Editor’s note: From Day One thanks our partner,  SoFi at Work, for sponsoring this thought leadership spotlight. 

Jessica Swenson is a freelance writer based in the Midwest. Learn more about her at jmswensonllc.com.

(Photo by Terminator3D/iStock)

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The student debt landscape has undergone rapid change in the past four years, with new repayment options, proposed forgiveness programs and further shifts anticipated under the new presidential administration. According to BestColleges, public college tuition increased an average of 5% a year between 2001 and 2021. During a From Day One webinar, Jon Harold, head of sales and partnership success at SoFi at Work, shared the big picture of student loans, the student debt crisis, and how that’s affecting employees. SoFi at Work is a division of SoFi, a company known for pioneering student loan refinancing and being a one stop shop for your financial needs. “Student loans are now at $1.7 trillion, a crisis in the United States, with over about 25% of Americans holding student debt,” said Harold, making the topic especially pertinent. As the workforce not only accumulates more student debt for degrees and advanced degrees, student debt programs can have a large factor in which position to take. “62% of private sector employees indicate that student debt influences their job decision,” said Harold. Additionally, “56% of employees spend three or more hours a week thinking about their finances, including student debt, and then, 36% of employees with student debt are less likely to remain with their employer than those without student debt, meaning if you have student loans, there’s not some sort of benefit, you’re less likely to stay if you don’t have student debt,” he said.The workforce is not unfamiliar with student debt associated with higher paying salaries within industries but even with the enticement of higher paying salaries through education student debt often becomes a great concern when seeking employment and staying within an organization. Employer Help With Student DebtHarold outlines four things employers can do to support their employees with student debt. The first is education, “giving employees access to guides, articles, webinars, with areas for them to ask questions.” The landscape of student loans is consistently changing, and employers can provide updates to their employees to keep them informed about the rapid changes in the student loan policies. Harold of SoFi spoke with journalist Emily McCrary-Ruiz-Esparza (photo by From Day One)Second is advice, and third is navigating student debt, Harold says. Providing counseling around student debt, such as talking to a student loan specialist. Sometimes the most impactful conversations are those that provide a variety of answers to a hard pressed question, like ‘What should I do with my student loans? Which payment plan is right for me?’ The fourth step is refinancing. Saving money whenever possible, whether by refinancing your student loans, consolidating them, or securing better terms, is essential.Often student loan borrowers are released into the workforce not fully understanding the options in front of them regarding payment plans, reimbursement, and loan forgiveness, employers can bridge the gap by providing resources to their employees. Offering Student Loan BenefitsLooking at the objectives of the company can provide the answer to these questions, says Harold. “We can help you evaluate student debt within your workforce, and then based on that you know, what are your objectives?” Companies can look at if they are having trouble recruiting a specific population or retaining a specific population, or do you want to just offer broader financial or student debt and financial well-being benefits. The percentage of companies offering student loan repayment benefits has doubled, jumping from 17% to 34% by the end of 2023, according to research. Currently, employers can offer up to $5,250 combined in tax-free student loan repayment and tuition assistance per employee through 2025, with the Consolidated Appropriations Act. Student loan repayment can create a strategic advantage that helps strengthen employee loyalty. The amount of changes in student loan repayment options, changes in the governmental role, rising cost in education, and gravity of stress related to finances provides an avenue for employers to harness benefits for employees that center around the mounting financial concerns including student loan payments. “Student debt is worsening and employees need help now. The government is incentivizing employer action and reducing support directly to borrowers” Harold said, encouraging employers to take action. “Companies that are offering student debt benefits gain an advantage in recruitment and retention–and SoFi makes it simple,” he said.Editor's note: From Day One thanks our partner, SoFi, for sponsoring this webinar. Tabitha Cabrera, Esq. is a writer and attorney, who has a series of inclusive children's books, called Spectacular Spectrum Books.(Photo by Inna Kot/iStock)

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The New 401(k)? Providing Student Loan Support as an Employee Benefit

Decades ago, a clever benefits consultant spotted a provision in the federal tax code, section 401(k), that would allow employers to create a tax-friendly way for their workers to save for retirement. The rest is history. As of this year, Americans have more than $7 trillion invested in their 401(k) accounts.Today, employees are having a different kind of problem: debt. More specifically, student loan debt. They need help digging out so they can then turn to saving. Thankfully, there’s a way for employers to help. Mick MacLaverty, CEO and co-founder of Highway Benefits, discussed the topic “Providing Student Loan Support as an Employee Benefit” during a recent From Day One webinar.The Student Loan ProblemThe sad numbers: the U.S. is approaching $1.8 trillion in student loan debt. This equates to about 46 million Americans, who average have about $40,000 in loans and around $400-500 a month to pay. 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