With student loan payments set to resume later this year, Schwab Retirement Plan Services (SRPS) has announced new student loan resources available to 401(k) plan participants to help better manage student loan debt.
Through an agreement with student loan and education benefits platform Vault, Schwab will offer the firm’s digital platform—Vault Advisor—to let plan participants on Schwab’s recordkeeping platform view and aggregate student loan information and access guidance and education to help them evaluate different strategies for lowering monthly payments, paying off loans faster and refinancing loans.
Plan participants can access Vault Advisor directly from the SRPS participant website. SRPS is offering the service to clients and plan participants at no additional cost, according to the announcement.
“Workers of all ages know that managing debt and saving for retirement are both very important, and they often come to us for guidance as they juggle competing financial priorities,” says Adrian Miguel, Director, Advice, Schwab Retirement Plan Services. “Managing student loan debt, especially for younger workers, often slows them down or even stops them cold when it comes to saving for retirement. When that happens, they lose out on one of the most powerful drivers of successful investing—time. Our role is to help them understand their options and show them a way forward.”
In addressing a need for the benefit, Schwab cites Federal Reserve data showing that student loan borrowers in the U.S. owe a collective $1.76 trillion in federal and private student loan debt. What’s more, in Schwab’s latest 401(k) participant survey, more than half of all workers said student loan assistance would be a desirable benefit at work, and nearly a quarter of younger workers said it would be a “must have” benefit if they were looking for a new job.
For its part, Vault notes that it was first to market in 2013 and currently provides over 2,200 employers with enhanced employee benefits options like student loan optimization, tax-advantaged student loan contributions, 529 payments and more. The firm also notes that its market differentiator amongst its competitors is that they are “conflict-free,” such that they are not a loan originator or financial partner with loan originators, and do not accept fees or commissions from any lenders.
“We think our commitment to do right by our clients’ employees is an especially powerful match with Charles Schwab’s renowned, decades-long focus on putting clients first,” Vault notes.
