ICYMI: Davis Guest Post on Student Debt Featured in Forbes
U.S. Rep. Rodney Davis (R-Ill.), along with U.S. Reps. Scott Peters (D-Calif.), Tom MacArthur (R-N.J.), and the CEO of Natixis Global Asset Management, John Hailer, published a guest post in Forbes last week about their efforts to help more college graduates pay down student debt, which is now the second highest form of consumer debt.
Davis’ legislation, the Employer Participation in Student Loan Assistance Act, would provide a new tool to help employers recruit and retain employees by allowing them to help them repay student loans with pre-tax dollars.
Below are excerpts from Davis’ guest post in Forbes:
“The class of 2016 graduated with the most student loan debt of any graduating class in history. The average graduate had more than $35,000 in loan debt, up 6% since 2015…
“Substantial student loan debt is not only a burden for graduates, but it hurts our economy… Student loan debt results in fewer people starting their own business. It causes individuals to put off major life decisions, like getting married and having children. It delays major purchases like buying a new car or a first home. And it impedes retirement savings, especially for millennial workers…”
Private companies take the lead
“Fortunately, a small number of employers have decided to take the lead and begin offering student loan repayment assistance, and more should follow suit. Employers offering student loan repayment assistance not only help attract and retain top-level talent, but they also send a message that employers know they receive the benefit of an educated workforce and are willing to contribute.
“Only 3% of U.S. employers currently offer some form of student loan repayment assistance. This number needs to grow, and quickly…”
“Several pieces of legislation now pending on Capitol Hill would empower and enable such efforts and encourage more companies to help employees pay down student loans.
“These bills, the Student Loan Repayment Assistance Act and the Employer Participation in Student Loan Assistance Act, are bipartisan proposals that incentivize employers to help graduates pay down student loan debt through a tax-exempt benefit…”
Why it works
“…Recent studies have shown employer-provided student loan repayment assistance has long-term benefits. If an employer provides $100 a month towards student loan debt, it can shorten a ten-year loan by more than three years, saving over $4,000 in interest…”
Read the entire post in Forbes.