Student loan debt affects people from all economic backgrounds and ages, but when it comes to young people, the impact can be far reaching and detrimental to both their finances and health. These were the findings from a new survey published yesterday by American Student Assistance (ASA), the nonprofit focused on removing the financial barriers to education.
American Student Assistance polled 502 workers between the ages of 22 and 33 and 451 human resource managers. The poll found that more than half of workers, 56 percent, are worried about their ability to pay back their student loans. Among those borrowers, 26 percent are worried about their student loans “all the time” while 30 percent think about them often.
What’s more, 40 percent think all the worrying about being able to pay back their student debt is impacting their health. But it’s not only creating undue stress and health issues, it’s also preventing them from going on to graduate school. 55 percent said that they can’t attend grad school because they can’t take on any more student debt. 61 percent of respondents even thought about getting a second job to help handle their student loan debt.
“Young workers feel highly stressed out as a result of the burden of student debt and that debt clearly impacts their health and productivity in the workplace,” said Kevin Fudge, Director of Consumer Advocacy and Ombudsman at ASA in a press release announcing the survey.
But it’s not only their present health or finances that are being impacted by student loan debt. ASA found 54 percent of borrowers can’t even think about saving money for retirement, earmarking all of their extra cash to paying down student debt. That can have long term ramifications for the quality of their retirement.
By delaying saving for retirement via company sponsored retirement plans, they are missing out on the matching component that many companies offer which means they are essentially leaving money on the table.
It doesn’t help that these young borrowers don’t feel like they are getting advice or help from their employers either. 63 percent of survey respondents said they have no one to turn to for help paying off their loans while 75 percent of human resource professionals said that their companies offer zero guidance when it comes to student debt.
That doesn’t mean young workers aren’t open to help, particularly from their employers. A growing, yet relatively new benefit involves companies paying down a portion of their employees’ student loan debt. The survey found that this benefit is welcome among a wide majority—86 percent of respondents. Not surprisingly, 93 percent would take advantage of a signing bonus that went to reducing their student debt load, and 79 percent said they would use a free student debt loan counselor if one was available.
The majority of young workers would work for a company for five years if it helped pay off their loans which is something millennial job hoppers aren’t accustomed to doing. The student loan benefit is a growing idea, and by these study results, it is clear how popular such a benefit will become. Many companies are starting to offer help to their new millennial employees.
“Employers should realize that in order to retain the brightest young talent and demonstrate their commitment to employee well-being, they need to provide concrete and straightforward solutions to help alleviate this burden,” Fudge said.
Author: Donna Fuscaldo
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