Tangible Solutions to the Student Loan Crisis

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The scope of the student loan crisis is significant. Forty five million borrowers owe a cumulative total of 1.6 trillion dollars in student loans, ranking just behind mortgage debt as the second highest debt category. [1] After making monthly payments on their student loans, borrowers have less in their budget for basic living expenses, but also higher ticket items like the purchase of a home, cars, appliances, furniture, and vacations. The resultant financial stress has an impact on borrowers’ quality of life, productivity at work, loyalty to their employers, and even the economy as a whole.
 
An Employee Financial Wellness survey conducted by PWC, found that 80% of student loan borrowers reported not being able to meet all of their financial obligations after making their monthly student loan payments. Another survey by Robert Half found that that 64% of workers are willing to change companies every few years if it comes with perks, such as assistance with student debt. The PWC survey also found that 49% of student loan borrowers indicated they spend three hours or more per week dealing with personal financial issues that adversely affect their productivity at work. [2]

Another effect of student debt is latent retirees: an alarming statistic is that there are 2.1 million senior citizens still paying off their student debt. [3] If older workers are not able to save for retirement due to the burden of student loan debt, they aren’t likely to be able to retire at what is considered normal retirement age. If they cannot retire with dignity, many seniors are compelled to continue working beyond normal retirement age. These latent retirees raise the cost of employment in the workforce due to higher health insurance costs of an aging workforce. [4]

In a study conducted by American Student Assistance 86% of employees indicated they would stay with a company for five years or more, if their employer offered a program to help them repay their student loans. In a MetLife study, 72% of employees surveyed said that customizable benefits would increase their loyalty to an employer. [5] Student loan repayment benefits can be a great way for a company to increase employee productivity, as well as an effective means to both attract and retain talent to an organization.

Join us for an informative webinar where we offer tangible, actionable solutions for individuals with student debt, as well as employers looking for ways to help their employees navigate their own personal debt crisis.
Webinar Date and Time

April 22^nd at 12:00 PM CST, with an expected duration of 1 hour. Register here!Webinar Speakers

• Tom Kret, Sr. Vice President, UBS Financial Services | Moderator
• Laurel Taylor, CEO, FutureFuel.i.o. | Speaker
• Mark Rose, Vice President of Product, FutureFuel.i.o. | Speaker
• Jenna Hokanson | Speaker

Sources:

[1, 3] https://www.forbes.com/sites/zackfriedman/2020/02/03/student-loan-debt-statistics/?sh=191a19c6281f

[2, 5] https://www.gradifi.com/notebook/workplace-trends/how-student-loan-debt-impacts-your-employees

[4] https://www.valuepenguin.com/how-age-affects-health-insurance-costs

For over three decades, as a Senior Retirement Plan Consultant, I have focused on assisting employers and their retirement plan participants to accumulate assets for their retirement. If you’d like to discuss how UBS’ Financial Wellness program could be a helpful resource to your employees in attaining their personal financial goals and objectives, call or email me. 

Direct: 847-277-2123

Email: thomas.kret@ubs.com