Highway Benefits

Last week, President Trump signed an executive order to dismantle the Department of Education. Shortly after, he announced the federal student loan portfolio would be immediately transferred to and handled by the Small Business Administration. Here's what borrowers may expect going forward: ???? Uncertainty and confusion as parts of the order will most likely face legal challenges ?? Processing delays as the portfolio gets transferred while the government simultaneously continues to downsize ?? Restricted availability of IDR and PSLF as the future of these programs remains in limbo What not to expect? The disappearance of the student debt crisis ??

Student debt is costing your company, even if only a fraction of your team has student debt. Here's how:

After three years of forbearance + a yearlong grace period, the full weight of the student debt crisis is back. And it's heavier than ever. ?? As recent court rulings have put SAVE, ICR, and PAYE repayment plans on hold, thousands of borrowers are facing potential monthly payment increases, sometimes upwards of thousands of dollars. For those who previously qualified for these income-driven repayment plans, making a new monthly payment that's significantly higher can feel debilitating. Employers can help. Even an extra $50 per month towards employees' student loans can have an outsized impact on employees' student loan payoff schedule and their financial well-being! If you're interested in getting an employer student loan repayment benefit up and running for you employees, talk to Highway. We can help you design and launch a hassle-free program in as few as 2 weeks.

As tax season gets into full swing, let's revisit why tax-free student loan repayment benefits are so powerful for employers and employees alike.

According to GoFundMe, nearly 40,000 individuals and organizations started campaigns to tackle tuition costs and student loan expenses in 2024. Crowdfunding is one way to go. Tax-free employer student loan repayments as a benefit is another. As student debt holders struggle with the burden of repaying their student loans, some are turning to their communities with desperate please for help. They don't realize that their employers can help. With the ability to contribute up to $5250 tax-free per employee per year, companies can tackle one of these employees' biggest sources of financial stress with a better approach than having employees rely on a GoFundMe.

In response to the upheld injunction against the SAVE plan, the Department of Education has temporarily removed the ability for borrowers to submit IDR and federal loan consolidation applications online. Note that borrowers may still be able to apply for these federal programs with paper applications.

Last week the courts decided to keep the injunction against the SAVE plan in place, effectively: 1?? keeping the SAVE plan in limbo 2?? preventing 8M borrowers from drastically reducing their monthly payments under the newest IDR plans. The SAVE plan has been in forbearance since June 2024 and this decision doesn't bode well for its future. ?? If the plan is eliminated, borrowers with student loans may find themselves struggling to make their monthly payments again. According to this article, "Some student-loan borrowers previously told BI that the SAVE plan was a significant financial relief for them and that they weren't sure how they'd afford higher payments without the plan." One way borrowers can still find financial relief? Through employer student loan benefits. With an educational assistance benefit, employers can contribute up to $5250 per employee per year, tax-free, directly to employees' student loans! Not only does his benefit help tackle one of employees' biggest sources of financial stress, it also can give employers can a valuable edge in attracting & retaining top talent.

What does the year have in store for student loans? Check out Mick's predictions for 2025 ???

Check out this post from our CEO, Michael MacLaverty, on how to reduce financial stress in the workplace!