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Hire and retain excellent employees.
This is one of the operating principles that was a driving force behind MidWestOne Bank implementing a new benefit program that helps employees pay down their student loans quicker through direct contributions from the company.
Americans have approximately $1.4 trillion in student loan debt and research has shown the pressure of student debt is causing today's workforce to delay marriage and home purchases and start a family, among other issues.
Though employees under the age of 30 are more likely to have student loan debt, people between the ages of 30 and 39 have the most student loan debt outstanding. This burden is widespread, according to research done by the Federal Reserve Bank of New York.
As part of the benefit, MidWestOne employees receive student loan contributions of $50 to $100 per month, based on their employment status and years of service. To qualify for the program, an employee must work a minimum of 28 hours per week and be employed for at least 30 days.
Employer contributions are applied toward principal repayment, helping employees pay down debt faster.
The program is being administered by Tuition.io, a leading platform for student loan repayment assistance. MidWestOne uses Tuition.io's technology to coordinate payments directly to its employees' student loan service providers.
'In a time when student loans are among the highest form of debt in the country, this type of tangible benefit leads to happier and more engaged employees,” Scott Thompson, chief executive of Tuition.io, said.
This program is one example of the way MidWestOne has approached development of its employee benefit program. The need to provide benefits that work for their employees is a must.
'Our employee benefits and services package is designed to fit individual needs, no matter what stage of life the employee is in,” said Soni Harney, the bank's senior vice president of human resources.
When the possibility of implementing the program arose, MidWestOne conducted a survey of their current employees, which yielded a 70 percent answer rate. The high response alone illustrated a need.
Reevaluation of benefits and perks is a constant process and one that bears fruit over time.
When asked about why student loan repayment struck such a chord, Charlie Funk, president and CEO of MidWestOne Bank, said:
'Helping our employees pay down their student debt faster isn't just a great employee benefit. It's the right thing to do.”
' Cathleen J. Weber is vice president of human resources for MidWestOne bank. Her column appeared in the May 5, 2019, issue of The Gazette's Iowa Ideas magazine.