Fidelity Investments is expanding its Student Debt Benefit program to include more options for employers to help employees pay off their student loans.
Under the Student Debt: Retirement option, an employer allows its employees’ student debt payments to qualify for the company’s matching 401(k) contribution. Raytheon and The Travelers Cos. have signed up for the program, which will take effect in January 2020.
Also starting early next year is Fidelity’s Student Debt: Benefit Choice, which will allow employees to trade in paid time off not taken into student debt payments. Unum, the employee benefits company, has signed up for this benefit.
The new options are offered to employers that use Fidelity as a custodian.
Currently, Fidelity’s student debt benefit program consists of direct after-tax contributions by employers to the servicers of their employees’ student loan debt. Fidelity began offering this program, called Student Debt: Direct, to its own employees in 2016. To date, more than 10,000 Fidelity employees have benefited, saving $55 million in student debt principal and interest payments, an average $5,500 per person.
In total more than 75 companies have signed up for Fidelity’s Student Debt Benefit program and thousands more are offering the firm’s Student Debt Tool, Pre-College and Refinancing solutions, all offered through its NetBenefits platform.
The Fidelity offerings are part of a growing trend of new benefits companies are offering in order to attract and retain employees at a time when close to 45 million Americans owe more than $1.52 trillion in student loan debt. That’s greater than the debt owed for credit cards and auto loans and second only to mortgage debt, and it is affecting the ability of younger American to start families and buy homes.