top of page

The Impact of Student Loan Debt on Employee Wellness: Why Repayment Benefits are Essential

Updated: Apr 17

For many people, student loan debt is a harsh reality that can impact their overall financial well-being. According to the Federal Reserve, Americans owe over $1.7 trillion in student loans, and this number continues to rise. As student debt has become more prevalent, its impact on employee wellness has become a pressing issue. In this article, we will explore the impact of student loan debt on employee wellness and why repayment benefits are essential for both employees and employers.

Financial Stress and Employee Wellness

One of the biggest impacts of student loan debt on employee wellness is financial stress. Financial stress is a leading cause of anxiety and depression, which can lead to absenteeism, low productivity, and even turnover. When employees are stressed about their finances, it can be challenging to focus on work and be productive. Financial stress can also impact physical health, as it is often accompanied by poor sleep, high blood pressure, and other health issues.

Student loan debt can be particularly stressful because it is often a long-term financial commitment. Unlike credit card debt or car loans, student loans cannot be discharged in bankruptcy, and they can last for decades. This long-term commitment can create a sense of hopelessness and anxiety that can be difficult to shake.

Furthermore, student loan debt can affect other financial goals, such as saving for retirement or a down payment on a house. When employees are worried about paying off their student loans, they may delay or forego other financial priorities, which can create more stress and anxiety.

The Impact on Mental Health

As stated previously, student loan debt can have a significant impact on mental health. Studies have shown that people with high levels of student loan debt are more likely to experience symptoms of anxiety and depression. Additionally, student loan debt can lead to feelings of shame or inadequacy. People may feel like they made a mistake by taking on too much debt or that they are not successful because they are still paying off their loans. These feelings can be particularly acute for those who are struggling to make their monthly payments or who are in default.

The Impact on Physical Health

When people are worried about their finances, they may neglect their health by skipping doctor's appointments or avoiding preventative care. This can lead to more significant health problems down the line, which can exacerbate financial stress.

In addition, financial stress can lead to unhealthy coping mechanisms, such as smoking, drinking, or overeating. These behaviors can contribute to obesity, high blood pressure, and other chronic health problems.

Why Repayment Benefits are Essential

Given the impact of student loan debt on employee wellness, it's clear that repayment benefits are essential. Repayment benefits can help employees reduce their stress and worry by providing financial assistance with their student loans. This assistance can take many forms, including:

  1. Direct payments: Employers can contribute directly to employees' student loan payments, which can help reduce the amount of interest paid over time.

  2. Refinancing assistance: Employers can provide access to refinancing options that can help employees lower their interest rates and monthly payments.

  3. Education and counseling: Employers can offer education and counseling services to help employees manage their student loan debt and create a plan for repayment.

  4. Matching contributions: Employers can offer matching contributions to employees who make extra payments on their student loans. This can incentivize employees to pay off their loans faster and reduce their overall debt.

It is clear that repayment benefits can improve overall employee wellness. By reducing financial stress, employees can focus on their work, be more productive, and have a better overall quality of life.

Additionally, by offering repayment benefits, employers can attract and retain top talent, which can improve the company's bottom line, and help to differentiate a company from its competitors in the job market. With student loan debt becoming an increasingly pressing issue for many workers, companies that offer repayment benefits may be more attractive to potential employees. Repayment benefits align with the values of many employees, particularly younger workers. According to a survey by the American Institute of CPAs, 86% of millennial workers said they would commit to an employer for five years in exchange for help with student loan debt.

Overall, offering student loan repayment benefits is a win-win for both employees and employers. By reducing financial stress and improving employee wellness, companies can see a return on investment in the form of increased productivity, improved retention rates, and a more engaged workforce.


Student loan debt has become a significant issue that impacts the financial wellness and mental health of many employees. As the cost of education continues to rise, the burden of student loan debt is likely to increase, making repayment benefits even more essential.

By offering student loan repayment benefits, employers can support their employees' financial and mental health, while also improving retention rates and attracting top talent. Investing in employee wellness is an investment in the future success of a company, and student loan repayment benefits are a crucial component of this investment.

As the job market becomes more competitive, companies that offer student loan repayment benefits are likely to stand out as leaders in employee wellness and attract the best talent. It's time for employers to recognize the impact of student loan debt on employee wellness and take action to support their employees through repayment benefits.

10 views0 comments


bottom of page