Small businesses and employers know the value of a good worker. Great workers who are competent and valuable to your company are worth their weight in gold.
That’s why retaining your best workers is a must in the world of small businesses, where larger and higher-paying companies are all vying for the best talent in the market.
For a small business, high turnover can be a serious drain on resources. Depending on your industry, you may already be continuously looking for new hires. Additionally, losing an experienced worker can be 1.5 to 2 times more costly than that worker’s salary. With the tables stacked against you, small businesses might find it difficult to cope with the costs of replacing and training employees.
Fortunately, you can take advantage of the large student debt crisis to help attract employees and keep the ones you already have. Simply put, providing student loan benefits as a part of the benefits package at hire can be a great way to increase employee loyalty and reduce turnover rates.
Student loan benefit packages are a huge draw for recent graduates who need help paying off student debts. According to a survey conducted by American Student Assistance, about 86 percent of young workers say that they would commit to an employer who helped them pay off their student debts. Student loan benefits can help the employee as well as the company.
Companies offering student loan benefits have a much better chance of retaining and attracting the best workers. Small companies have a lot of velocity, and we want to help you harness that velocity by using our technology and benefit to attract the highest level of talent. As a small business, you may consider this as a worthwhile but expensive benefit package, but it doesn’t have to be.
Vault provides a multitude of services to employees through the employer to help meet their student loan payments. We offer one-on-one student loan debt consulting for employees and a proprietary web tool designed to find the best way to pay off debts, and even help companies set up direct contribution towards their employees’ student loans. If you are interested or want more information, contact us today.
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The Federal Reserve Bank of New York Consumer Credit Panel/Equifax Quarterly released its 2017 Fourth Quarter report on household debt.
It shows that total household debt has grown past $13 trillion dollars even as unemployment has steadily dropped. Almost more noteworthy is student loan debt has increased by a dramatic $21 billion increase in 2017’s fourth quarter. This isn’t a new development – it’s a continuing trend that shows no signs of stopping soon.
While mortgage debt is down and the unemployment rate is the lowest since 2000, these positives are heavily outweighed by the dramatic rise of student debt. It’s rising so quickly that the debt is beginning to affect older Americans who can’t afford to pay for their own retirement. One analysis reports the number of people over 60 with student loan debt has quadrupled in the last decade from $700,000 to $2.8 million. Even further, this burden is starting to affect social security, as money has to be garnished from these checks to pay for the skyrocketing student loan payments.
As you can imagine, many Americans would be willing to find a way to pay off student loans before their retirement. Companies that help accomplish just this by offering a student loan benefit can experiencing recruitment and retentions boosts as a result.
When you offer a student loan benefit package like Vault, you can also help employees be able to start putting money into a 401(k) plan. At a time when over 70% of college graduates have student debt, offering a way out from under the mountain of debt for your an employees, with added progress toward a retirement plan can have significant ROI for your bottom line due to the potential of decreased attrition.
At Vault, we work to give you the tools you need enable your employees to make the most of this benefit. If your company is looking to diversify employee benefits and increase retention, look into adding a student loan package. It could be the deciding factor for many job seekers looking for a company that wants to help them plan their future.
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The cost of tuition for degrees continues to rise, seemingly without an end. The U.S. Department of Education provides statistics that are neither shocking nor comforting
Today’s generation of workers isn’t loyal like the one before them. The average worker is armed with too much information. They know who’s paying the highest salaries thanks Glassdoor, and Indeed makes job searching possible with a click.
Recruiters scan resumes on all of these networks, trying to fill holes in their rosters. Because of this, employers take active measures against turnover. The average worker only stays with their current company for two years, but it’s been proven that if you can get an employee to make it to five years, they’re more likely to stay for over 10 years.
Offering a student loan repayment benefit is one critical way to keep employees engaged. Every month your company could make a contribution toward student loan debt and help employees save money. Currently, the student loan debt crisis is nearing 1.4 trillion dollars – those numbers mean there are multiple people on your staff right now who are drowning in a monthly bill that’s stopping them from buying a house or upgrading their car.
By adopting a monthly student loan benefit, not only is it a cultural win for the company, it also lets employees know that you care about their well being. And with the mentality of today’s teams, that’s a massive win because “impact” is everything.
Vault works with companies to realize their retention goals. We’ve seen the benefit catch fire with some of the world’s biggest brands, like New York Life, and there’s no shortage of employers looking for ways to empower their staff. Student loan repayment is a great place to start.
If this sounds like something you’re interested in exploring, feel free to connect with us. You could take a huge step toward retaining your best employees.
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If retaining your best employees is an area that needs improvement, incremental vesting could be a solution. It’s easy to implement, but also works concurrently with the “carrot and stick” motivation principle. People love positive motivation – we’re biologically wired for it.
We’re motivated by interesting work and growing responsibility, but also need personal growth – it’s crucial for survival in the marketplace. Motivated employees work longer and harder to ensure that not only are their personal goals met, but they routinely go above and beyond.
One of the most effective ways to motivate an employee is offering a tiered system of vesting perks over time. With Genius Pay from Student Loan Genius, companies can increase the amount they wish to contribute toward student loans based on tenure. Companies with a small, part-time staff will offer a small repayment amount and gradually increase over time, but the larger, enterprise-level have started at $100 a month with yearly increases.
There’s a 15.1% employee turnover rate in every industry. Most Millennial employees will leave for a better deal with little consideration. Thanks to Google, they know what the competition is offering.
The average employee stays at a company for two years, but studies show if a company offers an impressive benefits package, employees are more likely to make it past the four-year mark, which leads to longer-term employment. Vesting over time might be the answer to keeping a few of your best employees and probably everyone else, too. Is the carrot and stick motivation principle right for your company?
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