In August, the Internal Revenue Service (IRS) provided guidance for employers to help employees pay back their student loans while also saving for retirement, as a SECURE 2.0 provision. The ERISA Industry Committee (ERIC) applauded the IRS for issuing Notice 2024-63 regarding matching 401(k) contributions made for student loan payments. However, ERIC now says more guidance is needed.

"The interim guidance was a good start, but regulators can do more to help employers design and execute programs that best serve their employees," said Andy Banducci, Senior Vice President of Retirement and Compensation Policy at ERIC, on Friday.

"Employees often choose between paying off their debt or saving for retirement. It should not be a choice between one or the other," said Banducci. "Employers want to match student loan payments with contributions to retirement programs to help meet the needs of their employees. But for these programs to be attractive to employers and employees, the parameters for how these programs operate need to be clear."