Record keepers adapt to needs for expanded financial wellness
Record holders are also engaged in student debt settlement programs. TIAA-CREF, for example, has partnered with social impact technology startup Savi Technology Inc. to help its nonprofit Plan Sponsor clients work with attendees to reduce their debt payments and seek relief by themselves Enroll in the government’s public service lending program. While many nonprofits qualify for the state student debt relief program, few do because it is awkward and difficult to navigate, said Snezana Zlatar, senior managing director and head of financial wellness advice and innovation at TIAA in New York.
Savi helps participants determine if they qualify for the program and helps them apply for and adhere to the program, Ms. Zlatar said. Savi also helps participants reduce their monthly payments by developing an income-oriented repayment plan that sets monthly payments based on individuals’ income.
Since the program started in June 2020, 44 universities and health institutions have taken over the service, with “three times as many registrations looking,” said Ms. Zlatar.
The 2,500 participants in the program are expected to save between $ 1,800 and $ 2,000 annually in reduced monthly payments and are well on their way to achieving an average lending of $ 50,000 per person. So far, the program provides for a total of nearly $ 155 million in planned forgiveness, Ms. Zlatar said.
“They offer real savings for individuals who can then direct them towards their retirement plans or other long-term goals,” she said.
Although the TIAA service does not provide a source of income, it deepens the record holder’s relationship with Plan Sponsor customers because “employers are aware that their employees have so many problems to contend with beyond retirement,” said Ms. Zlatar.
Savi charges a very small fee for the service, usually paid by attendees, but sometimes by plan sponsors. The monthly cost to employees “may be two cups of coffee,” Ms. Zlater said, a negligible amount compared to the $ 1,800–2,000 subscribers save in monthly payments annually.
“This is real money that helps individuals stabilize their daily finances and focus on long-term savings,” she said.