The benefits of earning a bachelor’s degree—higher pay, access to more job opportunities, increased job satisfaction, and career flexibility—are well documented. For many potential students, however, the prospect of paying for school can feel overwhelming, making a degree feel out of reach. But it doesn’t have to be.
There are options when it comes to financing your education, including scholarships, grants, and personalized payment plans. There’s another alternative, though, that prospective students often overlook: employer-funded tuition reimbursement programs. Taking advantage of this benefit can be an affordable way to pursue the degree you’ve always wanted.
What Are Tuition Reimbursement Programs?
Tuition reimbursement programs—also known as educational assistance programs—are benefits provided by an employer’s human resources department that enable employees to take college courses that are paid for by that employer. These programs are intended for employees looking to advance their education as it relates to their current career track, offering the chance to increase their industry knowledge and develop advanced skills.
These benefits are widely available, although under-utilized. A 2015 survey found that U.S. companies spend 28 billion dollars annually on educational assistance programs, with over 83 percent of organizations offering some type of tuition reimbursement benefit. On average, however, only two to five percent of eligible employees use tuition assistance programs, and 43 percent of working professionals are unaware if their employer offers this benefit.
Educational assistance programs vary by employer. One company, for instance, may cover the full cost of tuition while another might cap reimbursement at a dollar amount. On average, companies spend somewhere between $5,000 and $6,999 per employee per year, although organizations are beginning to increase their educational benefits as they see the positive impact they can have on their business.
A majority of companies require employees to pay out of pocket initially, reimbursing them for some or all of the tuition expenses once the semester is completed. Forty percent of organizations, however, will cover tuition expenses up front, allowing students to defer payments or establish individualized payment plans.
What’s the Catch?
Some tuition reimbursement programs have conditions that must be met in order for employees to qualify. Organizations may require employees achieve a minimum grade, such as a B, in order to receive their maximum benefit. Other organizations may stipulate that employees pursue courses or degrees directly related to their current role. For example, an IT company may be more likely to reimburse an employee pursuing computer science coursework as opposed to a history degree.
Regardless of the conditions of a tuition reimbursement program, you should be taking advantage of these types of professional development opportunities. These programs give individuals with financial hardships the opportunity to earn a degree and get ahead. Since a bachelor’s degree is increasingly necessary to land the most in-demand jobs, many employees now view these programs as a critical piece of a job’s benefits package.
Why Should I Take Advantage of a Tuition Reimbursement Program?
Many view the benefit as “free money,” similar to a 401k benefit provided by employers. By utilizing these programs, you can avoid taking out loans and save yourself thousands of dollars over the course of your education.
The skills and new credentials you’ll gain will also impact your performance in your current role and set you up for a higher salary and promotion. A recent Accenture and Lumina study found that those who participated in a tuition reimbursement program were 21 percent more likely to be promoted and saw a 40 percent higher wage increase over a three-year period.
From an employer perspective, there are many benefits to offering tuition assistance benefits to employees. Providing these incentives allows employees to develop critical competencies and skills that can have an immediate positive impact on the organization. What they’re learning in class on a Tuesday evening can translate directly to positive outcomes the following morning in the office.
Employers who offer professional development opportunities also have employees who are more engaged. Recent research by the Society for Human Resource Management found that an overwhelming 86 percent of employees say an organization’s commitment to professional development is “important” or “very important” to their overall job satisfaction.
Knowing their organizations are invested in their future, employees of companies that offer tuition benefits feel valued and are more likely to remain with the company. An Accenture study found that for every dollar companies spend on an educational reimbursement program, they save $1.29 through reduced employee turnover. By upskilling their employees, companies also have more promotable staff, lowering recruitment costs.
How to Take Advantage of Educational Assistance Programs
Despite knowing that employers also benefit from these programs, it can be daunting to ask your supervisor if professional development reimbursement isn’t an explicitly stated benefit. Here are some simple tips to taking advantage of your employer’s educational assistance benefits:
Find Out If Your Employer Offers Tuition Reimbursement
Check first to see that your company offers this type of benefit if you’re not sure. This can be as simple as checking the employee handbook you received upon hire. If in doubt, your best bet is to reach out to your human resource department. If there is a company intranet site, the policies may be available online for reference, as well.
Check the Fine Print
Don’t forget to check the details of the reimbursement program to make sure you qualify. Does the institution need to be accredited? Do you need a C, B, or higher to be reimbursed? Not sure if the courses you want to take apply? Check with HR to make sure you’ll be covered under the program stipulations.
Some companies may also require you stay with the company for a certain period of time after reimbursing your education; otherwise, you may be on the hook for the expenses. Make sure you factor this into your plan so you don’t end up owing anything after the fact. And, check to see if you need prior approval from a supervisor. If so, make sure you have the appropriate forms and signatures handy before applying for reimbursement.
Ask Your Boss
Try not to be intimidated—if the benefits are available, they will likely be more than happy to help you take full advantage of the program. Keep in mind that, for them, there are also many advantages to you taking professional development courses. Set aside a dedicated time with your supervisor talk about the next steps you can take to sign up.
Maximize Your Benefits
Make sure you get the most out of the benefit your employer offers. Plan ahead, keeping application and start dates in mind, to make sure you maximize the yearly reimbursement amount available. Check in with HR and your supervisor as questions arise, and make sure to mark important dates, like reimbursement request deadlines, on your calendar.
Take advantage of the opportunity to take professional development courses at no cost. By utilizing an employer’s tuition reimbursement program, your goal of earning a bachelor’s degree is within reach.
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