SoFi added 529 contributions to its benefits program, SoFi at Work. Employees will now be able to link their existing 529 plans to SoFi’s portal and make contributions from their paycheck. Additionally, employers may allow monthly contributions to the plans.
The personal finance company also plans to release a selection tool that will allow employees to select a plan that best suits their individual financial situation. SoFi CEO Anthony Noto says the company — which is best known for its student loan refinance program — has helped 250,000 members refinance $18 billion in student loans.
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“More than ever, employees are looking to their employers for financial wellness benefits and guidance,” says Noto. “The addition of 529 features to the SoFi at Work program is key to providing employers with best-in-class tools to provide their employees with the resources to help them achieve their personal financial goals.
The average cost of a college education has jumped to nearly $26,290 for public out-of-state universities and $35,830 for private universities, according to College Board data. However, a small number of companies offer 529 education savings plans to their workers. The number of employers offering 529 plans has remained steady over the past four years at 11%, according to data from the Society for Human Resource Management. Only 2% of companies offer an employer contribution to a 529 plan, SHRM found.
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SoFi’s upcoming screening tool will allow workers to enter basic information about expected tuition and household finances. Then the tool will recommend two college savings plans based on this information. The release date of the new tool has not yet been announced.