Earlier this week, Employee Benefit News (EBN) released an insightful piece on a Goodly platform user, WeedMaps. Like many California software companies, their employees have high levels of student loans on average. In an ever-growing field of tech companies based throughout the golden state, more and more firms are making sure to focus on recruitment and employee retention. WeedMaps is offering student loan repayment through the Goodly platform starting this January, a large leap forward in boosting employee financial wellness. Amanda Schiavo, writer for EBN, pointed out a few key takeaways from her interview with the firm.
An Underrepresented Benefit
Student loan debt has been steadily growing in the United States the past twenty years. According to educationdata.org, federal student loan debt is growing at 20% annually, eight times the rate of inflation. Throughout U.S. history, large bubbles of debt have contributed to the onset of economic recession. It’s expected that 40% of student loan borrowers will default on their loans by 2030, harming the American economy.
Employee Benefit News points out that “despite the impact [of student loans], employers have been slow to offer benefits that help employees toward financial freedom: just 8% of employers offer a student debt relief benefit, according to the Society for Human Resource Management”.
Employee benefits are a huge focus for California tech companies as we approach a new year of recruiting and reopening of the job market. The percentage of companies offering student loan repayment as a benefit is expected to skyrocket in the coming years. Employers will begin to have to offer this benefit to their employees in order to stay competitive with similar firms.
EBN points out that “student debt can have a significant impact on an employee’s mental health: 53% of high debt student loan borrowers have experienced depression because of their debt, according to Student Loan Planner, a financial advice resources provider”. Our client, WeedMaps, wanted to prevent this from happening.
Chief Operating Officer of Weedmaps, Steven Jung, took decisive action to make sure his employees stay financially healthy in this uncertain time. Weedmaps contacted Goodly in Q4 of 2020, and got quickly set up on our platform. Their first contributions to employee student loans happened earlier this month, helping to set the standard for employee benefits in California-based tech firms. Furthermore, employees who did not have student loans could open a 529 Education Fund with Goodly. A 529 Education Fund is a separate savings account for an employee’s children’s college, or one’s own further education (graduate school, among other things). If 529 Plans and/or Student Loan Repayment sounds like something that would benefit your organization, schedule a demo, or reach out to us at [email protected].