Nearly half of all working adults say paying off college loans is a very important financial goal — up 24 percent since 2014. (Photo: iStock)
Seventy percent of employers say improving their workers' financial wellness is a top benefits objective—up 15 percent since 2015. They see that poor financial health is causing problems for the American workforce. More specifically, student loan debt is playing havoc with employees' finances, their stress level and their ability to work toward such financial goals as saving for retirement.
Initial findings from the report “College Debt in America: The Case for Tuition & Loan Repayment Benefits” from the Guardian Life Insurance Company of America indicate that seven out of 10 working Americans with college debt put their finances at the top of their stress list, compared with just four out of 10 who don't have college debt.
With the total owed in student loans more than $1.5 trillion, it may not be surprising that the report also finds that fewer working Americans feel they're progressing well in paying off their college debt or saving for their children's college education compared with two years ago.
In fact, seven out of 10 say that they intend to use some of their retirement savings and investments of stocks/bonds to finance the kids' education, risking their own future retirement.
Boomers' college debt is actually growing, despite the fact that the most talked-about college-indebted generation is the millennial one.
But boomers are putting themselves and their retirement out there in the quest to help their kids get that sheepskin—and it's overextending them. The study data indicate that more than half of boomers say college debt is negatively impacting their ability to meet their financial goals, such as maintaining their lifestyle in retirement.
Says the report, “Recent data from the Department of Education confirms that at the end of September 2018, 1.8 million borrowers age 62 and older owed $62.5 billion in federal student loan debt and those in the 50–61 age group owe $213.6 billion.”
One solution that could help them as well as attract new talent to employers having trouble recruiting is a student loan repayment plan — and 79 percent of millennials would like an employer to offer such a plan.
Nearly half of all working adults say paying off college loans is a very important financial goal — up 24 percent since 2014. Fewer than 10 percent of all workers have access to college savings or debt-related benefits plans through their employer, such as tuition assistance, 529 savings plans or loan repayment.
“A majority of Americans rely on the workplace for financial security, and addressing college debt is one area of focus that is gaining momentum as a viable workplace benefit,” Marc Costantini, executive vice president, commercial and government markets, Guardian, is quoted saying. Constantini adds, “There is a growing interest among employers to differentiate themselves to attract and retain younger talent, and this workplace benefit can help make a positive difference in improving financial wellness among employees.”
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Marlene Satter
Marlene Y. Satter has worked in and written about the financial industry for decades.
