Companies are offering Tuition Assistance. Here’s What that Means
by Parker Piscitello-Faye
If the terms “employee benefits” and “tuition assistance” don’t make you jump up and down with excitement, you’re not alone. Unless you work in HR or are just really into your 401(k), you might only think about the benefits you’re getting from your employer once a year, if that.
We get it. Talking, reading, and thinking about employee benefits has historically, well, sucked. But, post-COVID, in light of the recent labor shortage, and “new normal”, employee benefits have been an important part of the conversation. Which is why, we (you, you and your friends, and, yeah, you and your boss) need to talk about them. And, part of that conversation should be about new benefits, like tuition assistance.
In turn, employers hope to boost retention and employee satisfaction. After all, they’re providing their workers with a benefit their competitors don’t and boosting professional opportunities in the market. Companies may participate in these programs because they’re opportunity to improve and expand their teams’ skillset. Plus, these benefits are tax deductible up to a certain amount per year per employee.
Yet, tuition assistance programs are also an amazing opportunity for employees. These programs allow employees to improve and build upon their skillset, finish or continue their education while working. If you’re hoping to pick up a new skill after spending the past two years at home, for instance, these might be worth looking into. Or, if there’s a skillset you want to work to improve, they can also give you the opportunity to practice.
Why should you care about tuition assistance?
If you feel settled in your career or at your company, you might not immediately see the benefits of a tuition assistance program. But, these programs don’t just benefit junior employees, looking to continue or finish their education.
For one, even though the gap between higher degree earners and earners with less educations is closing, those with bachelors still earn less over their lifetimes than their counterparts with master’s, doctorals, and professional degrees. And, those with bachelors earn much more over their lifetimes than their peers with no or some college.
However, more education won’t just benefit you financially. Learning a new skill set can also give you more opportunities to grow and challenge yourself as you advance in your career, so you don’t fall into a rut or feel stuck. Recent evidence also suggests learning a new skill can help combat stress and burnout. These programs, in turn, have psychological and mental health benefits even for those feeling set and settled where they are.
What should you be wary of?
That said, while tuition assistance programs can give you the opportunity to learn skills or information you wouldn’t have otherwise had access to, you should be cautious as you take advantage of them.
Namely, be aware that each company’s tuition assistance policies are a little different. While some employers are willing to reimburse costs for any course you take, some may only pay for courses relevant to your job. Your employer might also have a hard limit on the costs they will cover, the number of classes they encourage and pay for employees to take, or have a set of guidelines regarding online vs. in-person classes.
Also, look into whether your company is paying for the class no matter how well you perform in it. whether you are required to stay with the company for a set period of time after you complete the course, and whether your employer will pay for it or reimburse you.
For reasons outlined above, tuition assistance can be an amazing opportunity to keep learning while you work. And, of course, if your employer is willing to front the cost of a course or program, let them. Yet, make sure to read the fine lines of the policy before you engage with it, to make sure you know what you are expected to do and (depending on the program) pay.
Tuition Assistance Case Example with Mackenzie Stewart
As Mackenzie Stewart explains, “I’m currently in an AA program for accounting. I applied for FAFSA first (federal tuition funds) which is covering half of my tuition. The remaining half is split between my employer and me. So I pay ¼ and they pay ¼. “
Obviously, there are some catches.
She goes on “They will only cover classes that are relevant to the business. I had one international business class that I had to cover the full half of because we aren’t an international business. After each term, I print out my grade and confirmation of payment and my employer cuts me a check for their portion. At the end of this program, I will have only paid about $3,500 including books. I won’t have any debt and will have a guaranteed job after graduating for at least a year. This ain’t a bad deal at all. “
A List of 23 Companies that Offer Tuition Assistance and Reimbursement
Looking Forward: Navigating the Future of Employee Benefits
Tuition assistance is one of the new employee benefits to become popular post-pandemic, but it certainly won’t be the last. As more companies look to support their employees, many amazing benefits programs and platforms are becoming available. Employees simply need to take the time to look into them.
Luckily, Nav.it is here to help. Through articles like this one, and our app, we help employees and users improve their financial well-being, with budgeting tools, check-in features, and tons of information about money management.