Student loan match legislation proposed

Sen. Ron Wyden (D-OR) has reintroduced legislation that would permit 401(k), 403(b), SIMPLE and governmental 457(b) retirement plans to make matching contributions to workers as if their student loan payments were salary reduction contributions.

The legislation is based on an IRS private letter ruling issued last year permitting a 401(k) plan to be amended to include a student loan benefit program.

Student loans are a big deal these days because of the amount of student loan debt as well as the fact that student loan debt precludes many younger workers from saving under a 401(k) plan.

Studies have shown that households headed by a person age 35 or younger with a college degree and no student loan debt reportedly has a median deferral account balances of $20,000, as compared to $13,000 for similar families that have student loan debt.

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