More employers add 401(k) plan match for those paying student loans

cnbc.com:

Companies can now offer their workers a «match» on their student loan payments in the form of a contribution to their 401(k) plan — and a small but growing number of employers are taking advantage.

Traditionally, companies have only paid a 401(k) match to workers based on their voluntary contributions to the workplace retirement plan. A worker choosing to save 3% of their annual pay in a 401(k) might get a 3% match from their employer, for example.

Now, companies can treat a worker's student loan payments like an elective 401(k) plan contribution.

Federal law allows employers to give a match based on a worker's payments toward student debt. Workers generally don't have to contribute to the 401(k) plan to qualify for the funds.

The measure, part of a package of retirement changes dubbed Secure 2.0, kicked in starting in 2024.

The policy's goal is to help workers tackle two competing financial obligations: paying down debt while simultaneously saving for retirement.

More than 100 companies have implemented the benefit to date, covering almost 1.5 million eligible employees, according to data from Fidelity, the nation's largest 401(k) plan administrator.

They include «some of the largest firms in the U.S.,» like Kraft, Workday and News Corp., Jesse Moore, senior vice president and head of student debt at Fidelity, explained in an e-mail.

«Many more [are] showing strong interest in offering it in 2025,» Moore said.

About 5% of employers have already added the benefit, according to forthcoming survey results from Alight, one of the largest U.S. retirement-plan administrators.

Another 12% of employers say they are «very likely» to adopt it in 2025, while 29% are «moderately likely» to do so, according to Alight. It polled 122