In an apparent first among American municipalities, Memphis, Tennessee, earlier this month said that starting July 1, the city’s full-time employees will be eligible to receive $50 a month for their student loans. Alex Smith, chief human resources officer for Memphis, said about 840 people, or 14% of the city’s workforce, are expected to benefit from the program.
Memphis is following in the footsteps of some private-sector companies that offer assistance to their employees in paying down student debt. Gradually, more companies are realizing that help with student loans, among other nontraditional benefits, is useful in attracting and retaining younger employees.
About 4% of all companies give workers money they can use to pay down their student loans, according to the Society for Human Resource Management (SHRM), a human resources membership organization based in Alexandria, Virginia.
The need could not be more acute. Student loan debt has soared to $1.3 trillion nationwide and is held by about 42 million Americans.
A 2015 study by Pricewaterhousecoopers and George Washington University found that millennials in particular are putting off saving for retirement because of their student loan debt. More than half of millennials surveyed said they worry they cannot repay their student loans.
The College Investor, a website geared to providing financial advice to millennials, developed a list of companies that provide student-loan payment assistance to their employees. Many of the businesses are on either coast, and most of them are either financial firms or technology businesses. Amounts from the companies vary from as low as $500 to $10,000, and payments are made directly to the lender.
Health care company Aetna of Hartford, Connecticut, will match up to $2,000 per year for full-time employees, with a limit of $10,000 total.
CommonBond, a New York-based student loan refinancing and consolidation company, offers up to $100 per month, or $1,200 per year, toward employee student loan payments until the loan is fully paid off, as long as the person is employed at CommonBond.
Santa Clara, California-based textbook rental company Chegg offers $1,000 a year to workers repaying student loans.
ChowNow, a Playa Vista, California-based online food ordering system, offers an employer match to employee student loan contributions of up to $500 per year.
Fidelity Investments in Boston, Massachusetts, offers $2,000 per year to employees after six months of employment, with a limit of $10,000 total.
Gradifi, a student loan payment platform based in Boston, offers $250 per month, up to $10,000 total toward an employee’s student loan payments.
Student loan refinancing and consolidation company LendEDU of Hoboken, New Jersey, offers up to $2,400 a year to employees with student loan debt.
Kronos, a Chelmsford, Massachusetts-based workforce management software company, offers $500 a year to employees repaying student loans.
Visual computing technology company NVIDIA Corp. (NASDAQ: NVDA) of Santa Clara offers up to $6,000 a year, with a limit of $30,000 total to employees.
Natixis Global Asset Management, based in Paris, France, offers $1,000 per year upon beginning employment, with a $10,000 total limit.
Design firm Powertex Group of Eau Claire, Wisconsin, offers up to $100 per month to employees for up to six years.
Pricewaterhousecoopers, an audit and assurance, tax and consulting services company with offices in New York, offers $1,200 a year for employees with one to six years of tenure, topping at $10,000.
San Francisco-based loan refinancing company SoFi offers $200 per month to employees toward student loan payments.