SoFi has added 529 contributions to its employer benefit program, SoFi at Work. Employees will now be able to link their existing 529 plans with SoFi’s portal and make contributions from their paycheck. In addition, employers can enable monthly contributions to the plans.
The personal finance company is also planning to release a selection tool that will allow employees to select a plan that best fits their individual financial situation. Anthony Noto, CEO at SoFi, says the company — which is most well known for its student loan refinancing 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,” Noto says. “The addition of 529 capabilities to the SoFi at Work program is essential in offering the best in class tools for employers to provide their employees with the resources to help them reach their personal financial goals."
The average cost of college has ballooned to nearly $26,290 for public, out-of-state universities and $35,830 for private universities, according to data from the College Board. Regardless, a small number of companies offer 529 college savings plans to their workers. The number of employers offering 529 plans has remained stable 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 forthcoming selection tool will allow workers to input basic information about their expected college costs and household finances. Then the tool will recommend two college savings plans based on that information. A release date for the new tool has not yet been announced.
