Can your job help pay off your student loans?

Video Transcript

Could your job help you pay off your student loans? The answer is 'maybe.'

Hi, my name is Chris with Money Burst, and back in December of 2022, something called the Secure Act 2.0 was signed into law. The 'secure' part of that title is an acronym that stands for Setting Every Community Up for Retirement Enhancement, and the original version of this act was passed back in 2019. The 2.0 version contains a bunch of changes to the rules around retirement. And one of these changes is a twist on the 401 (k) match.

So, some of you may have a benefit that allows your employer to make matching contributions into your 401 (k) plan. And what this means is that, for example, you know, every dollar you put into your retirement account, your job will match you dollar for dollar, up to let's say 3% of your total income. It's basically free money and is a great benefit, and the specific details of how this works can vary from job to job. The twist that you might be seeing to your match is that employers can start counting your student loan payments as if they were contributions to your retirement plan to make you eligible for the match.

What this could look like is, say you made $3,000 worth of payments towards your student loans in 2025, and this was about 5% of your total income. If your employer had a dollar-for-dollar match up to 5% of your income, then you would qualify for matching contributions even though you didn't put any money into your retirement account. So, the great thing about this change is that it allows you to both pay your student loans down and save for retirement at the same time, which isn't always possible for everyone.

This new benefit won't necessarily be available for everyone, though. It will require your employer to add this option to your 401 (k) plan, so it might be a good idea to have a quick conversation with your HR department to see if they plan on making this change.