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That student loan match


The private letter ruling that allowed a certain 401(k) plan to allow the employer to make payments to a participant’s student loan instead of a matching contribution piqued a lot of interest. But is it more hype than anything else? Perhaps, but people felt the same way about automatic enrollment too.


While the decision by the Internal Revenue Service to allow it to a specific 401(k) plan doesn’t open the floodgates to every 401(k) plan, it will likely lead to regulations that will allow this feature to all 401(k) plans.


Will it become popular? Probably not because I think employers are slow to that take of features like that and many providers (especially advisors) have little interest in setting the feature up. However, I like choice and the more choices out there for plan sponsors to help participants out and maybe get them more involved, is a good thing.

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