|December 2023 Volume 21, Number 12
Support Your Staff As They Transition Back to Making Student Loan Payments
Now that federal student loan payments have restarted after a nearly three-year pause, HR teams can play a key role in supporting employees through this transition. With over 45 million Americans holding $1.77 trillion in student debt, many workers face renewed financial burdens from monthly payments.
As employees tackle the October payment resumption, HR staff should be equipped to assist them. This guidance can ease financial stress and boost retention.
Explain New Repayment Plan Options
A critical first step is educating employees about recent changes to income-driven repayment plans. The Biden administration's Saving on a Valuable Education (SAVE) plan lets borrowers cap payments at 5% of discretionary income, down from 10% previously. The plan also forgives balances after 10 years of payments rather than 20.
Assist with Loan Forgiveness Applications
HR staff should also understand loan forgiveness programs, especially Public Service Loan Forgiveness (PSLF). The sunset date for the temporary waiver offered under the pro¬gram was October 31, 2022. The program itself, however, is still active and can be applied for by those who qualify.
Consider Offering Repayment Benefits
While optional, some employers provide student loan repayment assistance. Contributing monthly payments can significantly speed up payoff timelines.
Have Patience as Servicers Struggle
HR staff will need empathy as servicers handle questions from millions of borrowers. Wait times over one hour are common.