Imagine a world in which the standard benefit package at work includes health insurance, 401(k) contributions, and a few thousand dollars to pay off your student debt. More companies than ever are offering that last perk, but it’s still a fringe benefit. Two bills making their way through Congress could change that, by giving companies a tax incentive to help employees repay their student loans.
The bills proposed in the U.S. Senate and House of Representatives aim to take away that hurdle by expanding a section of the tax code. The new policy would treat up to $5,250 per year in employer contributions toward student debt as nontaxable income, a change could make the student debt benefit go from a niche offering to one that’s more common than parental leave.
It’s certainly a benefit young people want. One survey found 80 percent of those surveyed want to work for a company that helps pay off student debt. Many young people prioritize paying off debt over saving for retirement, because the average debt burden for U.S. college graduates who take out loans is a $30,000 monster.