The New York Times just reported that only 60% of the 22 million student loan borrowers resumed payments in October after the pandemic freeze was lifted.
The student loan payment freeze was extended 9 times since its original order in March 2020.
Nearly 9 million borrowers have not made payments primarily due to financial hardship and in some cases confusion.
The Times spoke to one borrower who said, “It’s not an option for me to even consider adding an extra $600 or $700 a month to my expenses, [...] It’s not ‘that would be difficult’ — it’s just not a possibility.”
Although payments have resumed, borrowers who do not make payments will be protected until at least September 2024 with the new “on-ramp to repayment” policy.
This policy prevents things like delinquency reports to credit bureaus and tax refund collections.
Millions of borrowers are clearly struggling to make payments. The “on-ramp to repayment” policy is just another temporary band aid solution.
At Highway Benefits we believe employers can help ease the financial burden by offering Student Loan Repayment (SLR) as an employee benefit.
The IRS allows employers to contribute up to $5,250 per year towards repayment of an employee’s student loan, completely tax-free.
If you want your employer to offer SLR as a benefit in 2024, drop your email in the comments!