With the increased concern of being able to pay off student loans affecting millions of people nationwide, companies are adding tuition assistance to their benefits package to attract and retain talent.
Whether it’s to help pay down student loans you already have or to help pay for any future classes you’re thinking about taking, tuition assistance is a great benefit to consider taking advantage of. But, should you accept the assistance if it becomes available to you? Here are some things to consider before signing on the dotted line.
- Is there a commitment to the company attached to the offer?
This is something everyone must ask their manager or human resources department before accepting tuition assistance from their company. Some companies require a signed statement saying that an employee will work for the company for x number of years in exchange for accepting the aid.
If you’re fully committed to the company and see your long-term future with them, then this isn’t so much of a problem. You can accept the tuition assistance and develop your skill set to reach your goals within the company.
If, however, you’re on the fence about your future with the company offering the assistance, then it’s important to find out if there is a time commitment attached to the offer. You wouldn’t want to be stuck repaying the assistance with your time if you find that you want to be somewhere else.
As an example, my wife accepted tuition assistance from a company she used to work for. She received $5000 to cover tuition costs, and in return, she had to commit to working for the company for 2 years. In the second year of the commitment, we started making plans to move because I received a job offer from a company out of state. We had to consider our options at that point because if she didn’t fulfill her obligations, she would have had to pay back the entire amount she received from the company. This brings me to my second consideration.
2. Would you have to pay the amount back for any reason?
It’s important to get a clear answer on this question before taking any assistance from your company. The reason being is that life happens. If you’re forced to drop out of a program that you’re getting assistance for, or you have to quit working, you want to make sure you’re not stuck with having to pay back what you took from the company.
My wife and I got lucky in our situation with her company. She was able to transfer to a remote position months before we were scheduled to move for my new job. Doing this allowed her to continue fulfilling her 2-year commitment to working for the company in exchange for the tuition assistance.
3. Is the assistance given before the semester starts or after you get your grades?
This point might be the biggest hurdle for anyone thinking about using their tuition assistance benefit at work.
If the assistance is given before the semester starts, then that’s great! You’ll want to make sure you work hard to meet any grade requirements set forth by the company. Grade requirements are normally attached to the deal in accepting tuition assistance to ensure you did well in your classes.
Many times, however, tuition assistance is only given after you get your grades for the semester. In this case, you’ll need to send a transcript or proof to your human resources department showing that you met the grade requirements before the company will pay anything.
When tuition assistance is given after grades are received, a potential problem is figuring out how to pay for the semester up front. You’re responsible for paying for your education in the beginning, and once you send your grades to the company, they’ll send you the money. There are many options to consider here, and it’s a story I’ll save for another day. However, it’s important to explore all available options to see how your education is going to be paid for before the company pays you.
4. Would you be limited to studying what the company wants you to learn?
If you’re interested in going back to school, and you want your company to help with the bill, they usually want you to study something that will benefit the company. It’s important to make sure that your manager and HR department are aware of the classes you’ll be taking and for what purpose before you enroll in any program.
If you tell them that you’re taking classes for your MBA, but you end up taking one finance course along with a couple astronomy and physics courses, they may not offer you the full tuition assistance amount for that semester. Stick with the side of caution here and ensure everyone is on the same page with the classes you’ll be taking as well as the program you’re wanting to get into.
5. Is the tuition assistance for student loans you already have, or is it for taking classes while working with the company?
This is something to consider before accepting a new position.
If you’re swamped with student loans and have no plans of going back to school anytime soon, then having tuition assistance for only future self-development wouldn’t be very helpful to you in paying back your current loans.
On the flip side, if you’re wanting to go back to school for an advanced degree while you’re in your current position, but your company only assists in paying for student loans you already have, then this may also not be helpful for you.
Tip: When a company says they have tuition assistance, make sure to understand what kind of assistance it is, whether it’s help paying down current loans, or it’s to help fund a future degree.
Depending on what situation you’re in, one of these tuition assistance benefits may be significantly more useful than the other.
If you’re thinking about taking advantage of your company’s tuition assistance benefit, take into account these 5 considerations before you accept it:
- Is there a commitment to the company attached to the offer?
- Would you have to pay the amount back for any reason?
- Is the assistance given before the semester starts or after you get your grades?
- Would you be limited to studying what the company wants you to learn?
- Is the tuition assistance for student loans you already have, or is it for taking classes while working with the company?
Having answers to these questions can save you a lot of time and money.
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