In the wake of an extremely trying year, HR and benefit leaders across industries are gearing up to prioritize mental health for their employees or clients more than ever, and for good reason. Mental wellbeing is linked to greater job satisfaction, productivity, and talent retention, alongside numerous qualitative benefits as well — both on the job and in life.
Mental health support can come in many different forms, and it’s time that we focus on one area that’s commonly overlooked: financial stress. Holding student debt can be a major strain on mental wellbeing, confidence, and optimism for your employees.
Moving forward, more employers are making moves to build out their mental health benefits offerings. Want to understand why student loan support should be included in your plan? Read on.
The current status of the vaccine rollout may suggest a return to something like normalcy in the near future, which has employers eyeing late summer to fall as a potential return-to-work date.
This timing also lines up with another big date for millions of borrowers: The end of the student loan relief period. Since March 2020, borrowers have not been required to make payments on their federally held student loans.
That relief period is coming to an end in September, when loan repayment shifts back to business as usual. After over a year of not paying, some may find it difficult to adjust their routines (and their budgets) to pick back up on their monthly payments.
Return-to-work combined with a return to loan payments may present challenges ranging from minor to major for your employees. During this stressful time, offering a bit of extra support may go a long way.
Exploring the relationship between student loans and mental health
It is well-documented that debt causes stress that can compound and exacerbate feelings of anxiety, hopelessness, or depression.
Back in 2018, we teamed up with Student Debt Crisis to learn more about how student loans impact borrowers’ lives, and the results shed light on how far-reaching these impacts can be. Borrowers from across the nation reported that their debt has caused them to have less financial freedom, fewer career opportunities, and a stressful personal life — all significant barriers to achieving the kind of stability that supports mental wellbeing.
On top of this, 86% of participants said that student debt is a major source of stress. Of those respondents, one in three said it was their biggest source of stress.
For the vast majority of borrowers, student loans are a major stressor that limits their ability to build a life that is fulfilling, stable, and conducive to balanced mental health. And that’s a problem too big to ignore.
The biggest barrier to mental wellbeing? Money.
For every dollar that goes towards a loan payment, that’s one less dollar available for therapy, physical health needs, or other forms of treatment — all important pieces of the mental wellbeing puzzle.
And unfortunately, mental health services aren’t cheap. In fact, they can easily add up to cost as much as a monthly student loan payment. One single therapy session can range in price anywhere from $60 to $150. Considering that the average student loan payment hovers around $390 and that 65% of borrowers report having less than $1000 in their bank account, many may find themselves unable to afford that kind of support.
So how can I support my employees with student debt?
Helping your employees manage their student loans does not take the place of a robust benefits offering supporting mental health, but it’s a critical facet to consider.
Employers are now able to offer tax-free contributions to their employees’ student loans, taking some pressure off their teams while potentially shaving time off of their loan repayment period. With that extra bit of support, your employees will be that much closer to getting out of debt — and that can go a long way in boosting their hopefulness for the future.
Summer can help provide the support and resources to reach your employees’ loan repayment goals with less stress. Do some want to get on a path to forgiveness? We can help. Do some need to lower their monthly payment? We’ll find a way. Regardless of your employees’ type of loan, financial status, or repayment plan, we can offer personalized support to get them that much closer to being debt free.
And when it comes to alleviating financial anxiety, there’s also nothing like hearing that you’re already on the right track. With all the misinformation and complexities in the student loan space, it’s easy for borrowers to second guess their path. That’s why we love telling borrowers that their current repayment plan is already working. Take it from Jenny, a borrower who had her own plan validated by Summer: “You being an expert on this and saying that is really helpful … To know that I’m doing the best I can with what I have, that actually is very comforting.”
And even if the future does hold surprises or missteps, borrowers don’t have to go it alone anymore. Summer’s team of student loan experts are always standing by, ready to support your employees through every high and low of the student loan journey.
Interested in bringing Summer to your workplace? Learn more about partnering with Summer and request a demo.