U.S. Education Secretary Betsy DeVos recently called mounting student debt a “looming crisis.” In fact, outstanding student loan debt increased by $37 billion in the third quarter and now totals almost $1.5 trillion.
Student loan debt is now the second highest consumer debt category – behind only mortgage debt – and higher than both credit cards and auto loans.
Not wanting employees to stress about their student loans, but rather focus on their families and work, Miami-based Coastal Construction Group has announced a new program where the company will help pay for their employee’s student loans.
“Student loan debt is a real problem affecting more than 40 million Americans, particularly millennials,” said Coastal Executive Vice President and former Congressman Patrick Murphy, who is spearheading the repayment program at Coastal. “We wanted to do something meaningful to show our employees our appreciation and to help them tackle this debt faster, so they can start saving for important things like their children’s education, retirement, or buying a home.”
Coastal, which also views this program as a tool to attract and retain employees in a tight job market, estimated as many of 100 of its employees will participate. The company estimates it will cost them up to $200,000 a year.
To be eligible for the program, employees must have worked for Coastal for one year. Once they are eligible, in the first two years the company will pay $100 per month towards the employee’s student debt. In years three and four that monthly payment jumps to $125 and in year five until the loan is retired Coastal contributes $150 per month.
The average student loan is roughly $350 per month, so in many cases Coastal will be paying 50% or more of an employee’s monthly student loan.
The benefit is above and beyond normal pay.
“We hope our participation in this program will raise awareness about the extreme financial burden that student loan debt has caused for many working professionals and encourages other employers to get involved,” added Murphy, who also chairs the Future Forum Foundation, a nonprofit organization that researches key issues impacting millennials.
A recent survey found that 80% of working professionals with student debt consider their student debt to be a source of either significant or very significant stress, yet just four percent of employers currently offer student loan repayment contributions as a benefit.
With more than $4.0 billion in active commercial and residential projects throughout the state, Coastal is one of the largest general contractors in Florida. Coastal is currently constructing the first phase of Water Street Tampa, a 53-acre mixed-use development in Downtown Tampa, The Plaza Coral Gables, a multi-use development situated on seven acres, PARAMOUNT Miami Worldcenter, the signature residential tower of the 27-acre mixed-use development in Downtown Miami and many other projects in the Sunshine State.