Employer Student Loan Repayment Benefits

Employer student loan repayment programs can help ease the burden of student debt for workers while helping companies attract and retain top talent. Benefits may take the form of a monthly stipend, matching payments, or a lump sum to repay student loans.

Around 8% of U.S. employers offer student loan repayment assistance, according to the Society for Human Resource Management (SHRM). We’ve put together a guide to helpful resources for workers who are interested in getting student loan relief through their employers.

In this guide:

• What is employer student loan repayment?
• What does a sample employer student loan repayment program look like?
• Who is eligible for employer student loan repayment benefits?
• How to apply for employer student loan repayment benefits
• Companies involved with employer student loan repayment programs
• Tax implications of employer student loan repayment benefits
• Compare employer student loan repayment with other benefits
• FAQ

What is employer student loan repayment?

Employer student loan repayment assistance programs are designed to help workers pay off their student debt faster, with less strain on their paychecks. Assistance may take the form of direct payments or discretionary payments. 

• With a direct payment benefit, employers can offer a cash benefit for student loan repayment. We’ll cover options for delivering those payments in more detail below. 
• Discretionary benefit programs provide cash to employees but leave it to workers to decide how to allocate benefits to student loan repayment.

Employers can establish the guidelines for student loan repayment assistance, including:

• Which employees are eligible
• How much assistance to offer and how often
• What form benefits will take

Student loan repayment assistance is different from tuition assistance. Employers may offer to reimburse employees for some or all of the tuition and fee costs they incur to earn a certificate or degree while they’re working. 

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Which benefit is more valuable for you?

Rand Millwood

CFP®

You’ll want to evaluate this on a case-by-case basis. Depending on your current student loans and your long-term plans, one might be a benefit over the other. For example, if you have a low level of current loans at a reasonable interest rate but plan to pursue an advanced degree (e.g., an MBA), you might benefit more from the tuition assistance. On the other hand, if you have a significant amount in student loans at higher rates, or you don’t plan to obtain additional education, student loan repayment is the better benefit.

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How did the CARES Act affect employer student loan repayment?

Student loan repayment assistance is considered a taxable benefit, meaning if your employer offers those benefits to you, they’re included on your W-2 as income for tax purposes. However, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) is a $2.2 trillion economic stimulus bill that provided temporary relief for employees. 

Under the Act, employers can provide up to $5,250 in annual student loan repayment assistance with no tax consequences for employees. This benefit was extended through 2025 through the Consolidated Appropriations Act. Any benefit amounts over the $5,250 limit are still taxable. 

The limit covers student loan repayment assistance and tuition assistance. So if you’re getting both from your employer, your total tax-free benefit wouldn’t exceed $5,250.

What does a sample employer student loan repayment program look like?

Employer student loan assistance programs can take different forms depending on what the company chooses to offer. It’s helpful to know where student loan repayment might be included in a benefits package if you’re comparing job offers from different employers. 

• One-time bonus: Employers may offer a one-time signing bonus to new employees. You’d receive a lump sum, which you could apply toward your student loan balance.
• Monthly stipend: A second option is to offer a monthly stipend to employees specifically for student loan repayment. For example, your employer might offer $100 or $200 per month for the first five years of employment. 
• Matching payments: Similar to matching 401(k) plan contributions, employers may offer to match a portion of student loan payments. Employers might set an annual and lifetime cap on the amount they’ll match.
• Benefit swaps: Companies might allow employees to leverage unused benefits for student loan repayment. For example, you could “cash in” accumulated vacation days or paid leave benefits and use the money to pay down student loans.
• Retirement-linked: Contributing to a workplace retirement plan can help you gain tax benefits while building wealth. Employers may offer to make contributions to the plan on your behalf if you commit to putting a certain amount of your pay toward your loans each month. 

Federal employees can also benefit from student loan repayment assistance through their employer agencies. Eligible employees may qualify for up to $10,000 in aid each calendar year or $60,000 lifetime if they agree to a service commitment.

If an employer offers direct payments for loan assistance, they can send that money to the lender or pay it to the employee. These payments are made on top of what you’re already paying to your loans. Student loan repayment assistance can help you pay your debts off faster because more money goes to the balance. 

Who is eligible for employer student loan repayment benefits?

Employers can determine which employees are eligible for student loan repayment benefits and how much to pay. Eligibility may be based on:

• Whether you’re a full-time or part-time employee
• How long you’ve been employed with the company
• How much debt you have
• The types of loans you owe

Companies may choose to exclude part-time employees or require at least a year of employment before benefits kick in. Employers can also tier benefits, offering more in student loan assistance for each additional year you stay with the company or requiring you to work there a certain number of years to get the full benefit.  

Employers might extend the same benefits to children or spouses of employees, but they’re not required to. However, if your employer offers this perk, consider whether it would come in handy. 

How to apply for employer student loan repayment benefits

If you’re interested in getting help with student loan repayment from your employer, the first step is finding out whether it’s an option. 

Contact your human resources department to see what student loan benefits, if any, might be available. If the company offers loan repayment assistance, the next step is finding out how to qualify. Here are helpful questions to ask your HR representative:

• Am I eligible based on my current employment status?
• If I’m not eligible, what can I do to qualify for assistance?
• Is there a formal application I need to fill out to apply for aid?
• If approved, how much assistance will I receive, and what form will it take?
• Should I expect any benefits to be considered taxable?

If your employer doesn’t offer help with student loan repayment, you could suggest it as an addition to the employee benefits package. You might also consider the more extreme move of making a job change to a company that helps with student loan repayment. However, it’s wise to weigh the pros and cons first. 

Companies involved with employer student loan repayment programs

Employers that offer student loan repayment often partner with a third-party company to roll out benefit programs. These companies can assist with designing, setting up, and maintaining the program.

For example, that can include creating an online portal so that employees can track their benefits and repayment progress or facilitating the movement of payments from the employer to the lender. 

If you’re thinking of asking your employer to offer student loan repayment assistance, here are a few companies you might recommend. 

Click the company name in the table to see more details about its plan.

Company	Features	How it works	Participating employers
EdAssist	Flexible program options Financial wellness coaching Tuition assistance	Tailored repayment and tuition assistance solutions	Aetna Atrium Health   Nvidia Orlando Health Volkswagen
Tuition.io	Works with employers Full suite of solutions Live experts	Multiple solutions, including loan management and PSLF tools	ADP Children’s Hospital & Medical Center (Omaha) Ford Hulu Guardian Live Nation
Peanut Butter	Multiple industries Student loan tools 3 plan tiers	3 plan options for different needs	1871 Medfix International Rise Interactive ProService Hawaii
Edcor	Customized programs Academic advisory services	Administers tuition and loan assistance with added benefits	WageWorks Inova Health Several higher education institutions
Gradifi	Monthly contributions Direct payments to servicers  Simplified onboarding	Employers pay loan servicers	PwC Carvana Peloton Sothebys Eversource Mattel Yelp

EdAssist

Find out more

• Flexible program options. 
• Financial wellness coaching is included for employees. 
• Also offers tuition assistance programs. 

How it works: EdAssist, a Bright Horizons solution, offers student loan repayment assistance programs and tuition assistance programs for employers who want to attract new employees and retain their current workforce. The company works with employers to provide tailored solutions for repayment assistance. 

Benefits for employees include:

• Access to financial wellness coaching
• Seamless online user experience
• Transparency with student loan repayment

Participating employers: Bright Horizons works with a number of employers to offer education benefits, including student loan repayment assistance. Current partners include Aetna, Atrium Health, Nvidia, Orlando Health, and Volkswagen. 

If you work for any of these companies, contact HR to find out which benefits are available. 

Tuition.io

Find out more

• Works with employers and benefits providers.
• Full suite of education solutions available. 
• Live experts are on hand to answer questions. 

How it works: Tuition.io partners with employers to offer multiple solutions for borrowers, including:

• Student loan management tools
• Student loan repayment assistance programs
• Tuition assistance programs
• Public Service Loan Forgiveness (PSLF) tools

Tuition.io is committed to helping employers retain talent while providing benefit programs that yield tangible savings for employees. To date, employer contributions through Tuition.io have saved employees more than $150 million. 

Participating employers: Companies that work with Tuition.io to offer student loan and tuition assistance include ADP, Children’s Hospital & Medical Center (in Omaha, Nebraska), Ford, Hulu, Guardian, and Live Nation Entertainment. 

Peanut Butter

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• Works with companies in multiple industries. 
• Student loan tools and assistance are available. 
• Employers can choose from three plan tiers to meet employee needs. 

How it works: Peanut Butter helps employers offer student loan repayment assistance as an employee benefit. Employers can choose from one of three plan options, each of which serves a specific goal:

• Help employees refinance their student loans
• Empower employees to take control of their student debt
• Contribute to employee student loans

Peanut Butter serves employers and employees across a variety of industries, including banking, construction, education, health care, hospitality, insurance, and tech. Borrowers get access to an easy-to-use digital platform and the potential to claim other benefits, such as a $200 rebate for refinancing their loans. 

Participating employers: Peanut Butter’s participating employers include 1871, Medfix International, Rise Interactive, and ProService Hawaii. 

Edcor

Find out more

• Student loan and tuition assistance are available. 
• Assistance programs customized for each employer. 
• Employees have access to academic advisory services and special discounts.

How it works: Edcor administers tuition assistance and student loan assistance programs for employers to help employees reduce their student debt. Benefits employees enjoy if their employers enroll with Edcor include:

• Academic advising and counseling
• Textbook discounts
• Access to a financial wellness marketplace that includes student loan and loan refinancing offers from vetted lenders

Edcor works with employers to create a customized solution to best meet employees’ needs. Employees can access their programs securely online to monitor their payoff progress, benefits, and savings. 

Participating employers: Edcor’s network of partners includes a number of higher education institutions, WageWorks, and Inova Health. If your employer works with Edcor, clarify whether it offers tuition assistance, student loan assistance, or both.

Gradifi

Find out more

• Employers can help pay off student loan debt with monthly contributions.
• Contributions are paid to student loan servicers. 
• Simplified employee onboarding. 

How it works: Gradifi helps employers pay down student loan debt for employee borrowers. Once your employer creates a plan with Gradifi, they can make payments to your loan servicer each month, with the option to make additional one-time bonus payments. 

One feature the platform offers is a free calculator borrowers can use to see how much money they could save if their employer opts in. For example, a borrower who owes $35,000 at 5% could save just over $14,000 and pay off their debt four years faster if their employer contributes $200 per month. 

Aside from student loan repayment assistance, Gradifi’s benefits include financial tools to help manage student debt and a savings program for employees who want to set aside money for their children’s college education. 

Participating employers: Gradifi’s participants include PwC, Carvana, Peloton, Sothebys, Eversource, Mattel, 23 and Me, DCU, Fareway, Yelp, Penguin, and Random House. 

Tax implications of employer student loan repayment benefits

Ordinarily, education assistance provided by employers to employees is considered taxable, just like any other wages or income you receive. Prior to the passage of the CARES Act, benefits for tuition assistance were tax-free as long as they did not exceed $5,250 per year. 

Through 2025, the $5,250 exclusion limit applies to tuition assistance and student loan repayment assistance. Anything over that amount is still considered taxable. That raises an important question: Is student loan assistance worth it if you have to pay taxes on the benefits you receive? 

The answer can depend on how much you’d potentially save on interest versus what you’d pay in taxes. For instance, if you’d pay $1,000 in taxes over five years for student loan assistance but save $6,000 in interest charges over that same period, you’re leaving money on the table if you don’t take advantage of those benefits. 

We asked Rand Millwood, CFP®, whether he could think of any reason an employee should consider not participating in an employer’s student loan repayment program. He advised:

Likely the only reason not to participate in this type of program would be if you’re in a high income tax bracket due to a high-income-earning spouse or other significant outside income, and the taxes you’d pay on the benefit would negative the interest offset of paying down the debt.

Compare employer student loan repayment with other benefits

Getting help with your student loan payments can be an incentive to choose one employer over another, but it shouldn’t be your only consideration for evaluating job offers. It’s important to look at the benefits package as a whole, so you understand what you’re getting and what trade-offs you might be making. 

Here are helpful questions to ask when comparing job offers: 

• What type of education assistance is available?
• If it’s student loan assistance, is there a catch you need to be aware of? And how much aid could you get?
• Does accepting student loan assistance mean forfeiting other benefits, such as 401(k) contributions or paid vacation time?
• How much would student loan assistance help in the long run, in terms of interest savings and accelerating debt payoff?
• What else is included with regard to health insurance, vacation days, sick leave, life insurance, or other incentives?

Looking at the big picture can help you decide whether education benefits might offset anything that makes a job offer less attractive. For instance, if you make a lengthy commute each day or your employer doesn’t offer a retirement plan, consider whether those sacrifices are worth making based on your goals. 

Additional considerations about employer student loan repayment

Aside from the specifics of the program, consider what would happen if you decide to change jobs. Your student loan benefits wouldn’t follow you, so consider your overall career plans if you think you might not stick around at your current employer for long. 

And remember: You aren’t guaranteed to qualify for student loan repayment help even if your employer offers it. If you’re not a full-time employee or you don’t have the right kind of loans for the program, repayment assistance might not be an option. 

Don’t neglect your retirement fund

Employers may offer to help you pay off your student loans in place of a 401(k) matching contribution. That’s still a solid benefit—it can help you pay your loans off faster—but don’t slack off on funding your retirement. 

Financial experts often encourage saving at least enough in your plan to get the full match. But if no match is available, you might have to step up your contribution amount to stay on track with your savings goals. Paying down student loans is important, but don’t let retirement slip to the back burner. 

Rand Millwood, CFP®, shared the following recommendations for prioritizing the benefits prospective employers offer from a financial planning perspective:

Depending on the individual and their family situation, student loan repayment would be second or third if you’re considering a position’s 401(k) or pension and health savings account as well as student loan program. 

Funding your 401(k) should be your first priority because the most significant benefit you get is time. So the sooner you start funding your 401(k), even at low levels, the more it pays off. 

If you are a younger or fairly healthy individual, student loan repayment is likely the second most important benefit because it can help you get rid of a debt overhang that affects your savings and cash flow over the long term. 

If you’re older with a family or have health issues, health savings accounts may be a better second benefit because of the regular ongoing costs you need to meet. However, this is case-by-case for each individual or family.

>> Read more: Student Loan Repayment Guide

FAQ

Can you still refinance your student loans if your employer is helping with repayment?

It’s possible to refinance student loans while getting employer assistance with repayment. That option might even be built into your program. Peanut Butter, for example, offers a refinancing program to employers, along with incentives to employees who refinance through partner lenders. 

What happens if you leave your job?

If you leave your job, your employee benefits package doesn’t migrate with you. You’ll lose access to any student loan repayment assistance benefits your employer offers. 

Can you combine employer benefits with federal repayment programs?

Enrolling an income-based repayment plan for federal student loans could save you money. You can also streamline your payments using a Direct Consolidation Loan. You could combine those benefits with employer benefits if your loans remain eligible for your company’s assistance plan. 

Do these benefits extend to Parent PLUS Loans or private student loans?

Whether an employer extends student loan repayment assistance to Parent PLUS Loans or private student loans is up to them. Companies can decide which loans are eligible for their plan, as well as which employees may participate and receive benefits. 

What common terms and conditions should you be aware of?

If your employer offers student loan repayment assistance, it’s helpful to know what exclusions may apply. It’s also wise to consider what’s required for payments (for example, automatic versus manual payments) and what might happen if you miss a payment to your loans. 

Are there alternatives to employer student loan repayment benefits?

If you work in a public service role, you might be eligible for Public Service Loan Forgiveness. Likewise, you may qualify for loan forgiveness if you work in certain branches of government. You could also make your loans less expensive and easier to manage by refinancing them into a private loan.