SoFi is all over the airwaves with its lending program. It wants to refinance student debt, get employers to help pay it down, and get younger workers closer to the day when they can better focus on saving for retirement.
It's yet another entrant in the student loan fray. SoFi is not only in the business of lending — including refinancing student loan debt — and wealth management, but it has joined its client companies in offering student loan assistance as a benefit to its own employees.
As assistance in repaying student loans grows in popularity as an employee benefit, firms are beginning to sign on to various options that allow them to be part of the process. Sometimes that's by way of helping employees to do a better job at saving for retirement; sometimes it's a recruiting tool that can help them out from under an otherwise crushing debt load that can stall everything else in life from marriage to home purchases.
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The trend appears to be growing in popularity, as can be seen by SoFi's funding of more than $1 billion in student loan refinancing to borrowers "entirely through corporate and association partnerships," according to the company. Those "partners," more than 400 of them, are "lead[ing] a shift in employee benefits that reflects the current needs of early-stage professionals" who are "more concerned with their student debt than they are with saving for retirement."
Federal student loan interest rates range from 4.29 percent to 6.84 percent, depending on such factors as whether the person applying for the loan is a an undergraduate, a grad student, a professional, or a parent. At SoFi, according to its website, student loan refinancing can be had for as low as 3.50 percent (fixed rate) or 2.14 percent APR (variable rate, with AutoPay). That kind of difference can add up over the life of a loan.
According to the company, "That savings can enable employees to participate in other important voluntary benefits like 401(k) plans and health care savings accounts that they are otherwise forsaking."
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