More Large Companies Embrace Student Loan Benefit To Help Workers Save For Retirement

In today's edition of Forbes Edge, we'll dig into who made Forbes' list of the World's Best Employers 2024 and get insights from a Q&A with Marianne Markowitz, the CEO of First Women's Bank. But first, a look at how companies are utilizing a new benefit to offer extra retirement savings to workers with student loan debt.

Did you know that employers can match your student loan payments with contributions into your 401(k)? Thanks to Secure Act 2.0, which took effect January 1, employers can now offer extra retirement savings to young workers making student loan payments, even if the employee is not contributing to their retirement account on their own.?

On Thursday, Walgreens became the latest large employer to embrace this benefit, offering it to the company’s more than 300,000 employees. This means that Walgreens will match up to 4% of eligible pay for workers who are paying down student loans, even if they have not contributed directly to their 401(k) themselves.?

Employees who’ve worked at Walgreens for one year and have completed 1,000 hours of work are eligible.?

The program has been lauded as a win for young workers who have to choose between saving for retirement or paying off debt. At Walgreens, roughly 30% of the company’s employees are facing financial debt from higher education, according to the company, including more than half of its pharmacists. On average, pharmacists have $170,000 of student debt, according to the American Association of Colleges of Pharmacy, making it one of the professions with the highest debt.?

While other major employers—including Verizon, Kevin Hart-owned Hart House, Chipotle and Abbott Laboratories (a medical devices and healthcare company)—are offering the same benefit, its adoption has been slow, according to Bloomberg. The hesitance is largely due to employer’s compliance and logistics concerns in its implementation, even after the IRS issued additional guidance in August.??

As the Biden Administration’s student loan forgiveness plan moves through the courts, student loan 401(k) matching could be a major help to the 42.8 million Americans paying off student loan debt. But the key question remains: Just how many employers will implement it???

In other news, another hurricane is scheduled to make landfall in the south this week. To all of those in the path of Hurricane Milton, please listen to local officials and I hope you stay safe.?

Happy reading, and hope you have a lovely week!

—Maria Gracia Santillana Linares, Careers Reporter

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Careers Q&A: CEO of First Women’s Bank Marianne Markowitz

A career financial expert, Marianne Markowitz is the founding CEO of First Women’s Bank, a Chicago-based bank focused on serving women. Fresh off the heels of announcing the launch of the FWB Collective, a resource hub for women to launch their own businesses, I spoke with the First Women’s Bank CEO to speak about her career in finance and focus on banking for women, working with small businesses, and what she learned working in both the private and public sectors. Our conversation has been edited for length and clarity.?

Before starting First Women’s Bank, you had some impressive stints as a risk and treasury manager in the private sector before heading up the Small Business Association. What did you find was the biggest pain point in the transition from private to public employers?

You know, it’s interesting because I expected there to be more pain points than I actually experienced. Up until that point, the Small Business Administration (SBA) was the smallest organization I’d ever worked for––even Barack Obama’s presidential campaign was larger. So as a federal agency, you were able to actually shape that agency, which was really interesting as an entrepreneurial-focused group. So I didn’t experience that many pain points. Now, if I’d joined a much larger agency that would have been different! But the SBA is a unique agency in how it mirrors the private sector more because most of its partners are in the private sector, and works with over 4,000 banks.?

Oh interesting! What’s your advice to someone who may be considering a similar move, jumping into working with federal or government agencies?

There’s a lot of doors into the public sector, so it’s likely there is one that fits most people’s backgrounds. I would say if you’re inclined to serve at all, then it’s a fit for you. It’s all about service, and it’s an amazing way to build a career. It’s hard to explain, and you can’t understand the scale of your impact when you’re in the public sector (almost like you can’t explain what it’s like having a baby until you do!). You get to touch and impact so many lives with the work you do, it’s an amazing place to build a future.?

Between starting First Women’s Bank and working in banking, you’ve had the experience of both being a founder but also climbing the corporate ladder. What is one thing you learned during that time that really helped you reach the C-Suite both as a CFO at the Obama presidential campaign and now as the founding CEO?

The next step is not only the one that is right above you. Sometimes I think we only see our careers linearly. But often moving side to side and gaining other experience will prepare you to move up, and it may not be the immediate channel that you see right ahead of you.?

The other thing is sometimes, our work doesn’t give us the opportunity or positions that we’re ready for. Sometimes, it doesn’t give us the opportunity to lead, or that’s not part of your particular job at the time. So look outside your day job and find opportunities. We don't make the time to do that early enough in our career. Go find a nonprofit, get on a board, because when I look at a résumé I look at all of that. Where is the leadership in this résumé? It may not be in your position, but it happened because you did something that was really important to your job that aligned with your values outside of work.?

Also, show up to the employee resource groups!?

That’s a good point—leadership doesn’t have to be in your job description to become a leader. What is one unique thing you look for in not only new hires, but women who come to the bank looking for funding or loans?

As women, we can often have disruptions in our career. We’ve got live events that we’re balancing with that, and those disruptions can make for zig-zags in our résumés. That’s something we really understand at First Women’s Bank, and we give a lot of credit to the portability of experience and how we underwrite someone’s ability to lead a business. It’s something we really acknowledge, even if their career doesn’t play out in a linear fashion.? That’s one way we really acknowledge and show up for women.

TOUCH BASE

News from the world of work

Microsoft, Google parent Alphabet and Samsung Electronics topped Forbes’ World’s Best Employers 2024 list, a ranking of the best 850 companies to work for around the world. Though banking and financial services dominated this year’s list, companies providing career development and upskilling opportunities climbed up the ranks.

September’s jobs report smashed analyst expectations as 254,000 new jobs were added to the economy, according to the Labor Department, over 100,000 more than expected. The unemployment rate also dipped, falling to 4.1% from 4.2% in August. Revisions for June and July jobs reports also saw an increase of 72,000 jobs added over the summer.?

The National Labor Relations Board filed a complaint Wednesday alleging that Amazon illegally refused to bargain with the union representing drivers hired by a contractor. Amazon, the complaint says, broke the law by terminating its contract with the contractor after the drivers unionized without first bargaining with the Teamsters union that represented them.?

Retail, hospitality and food service managers are planning to hire more seasonal workers as the holiday season approaches. Current staff, they say, lack the skills and experience for seasonal demand––61% of surveyed managers by Axonify say the quality of applicants is worse this year.

Quiz

Which workers’ union ended its strike last week after reaching a tentative agreement that includes a 62% wage increase over six years?

A. Port workers on the East Coast

B. Boeing manufacturers

C. Hilton hotel workers

D. United Auto Workers members at Stellantis

Click here to see if you got it right.