Paying for college: Get your employer to help

By Gina Pogol

Education Articles

Most larger and many smaller firms offer some form of tuition reimbursement. A survey of 314 companies with 1000 or more employees found that 78 percent of them share education costs with their employees. Why do companies make this investment? In addition to increasing the value of their workforces, paying for education fosters loyalty and decreases expensive employee turnover. In addition, companies get tax breaks for supporting higher education for their workers.

Check your employer's tuition reimbursement policy

Before you blithely sign up for an expensive degree program and begin dropping big bucks on books, parking passes, and non-refundable fees, check your employee handbook. You probably need to get your program pre-approved, your manager may have to get on board, and there will almost certainly paperwork to complete and hoops to jump through.

Many companies set limits on the amount that they pay, such as a fixed dollar amount per employee or per course. Limits may be higher for employees with more seniority or those pursuing higher-level education. See what the limits are before choosing a school -- and don't be surprised if your employer's largesse doesn't extend to Ivy League degrees!

Your reimbursement may depend on how much you apply yourself to your coursework. For example, hard workers may be 100 percent reimbursed for an A, and slackers with Ds may get zip. If your only reason for going to school is to meet drinking buddies, a partial reimbursement policy may cause you to rethink your plan and your motivation.

Understand too that most employers will pay only for courses that they consider to be work-related, but according to US News and World Report about 15 percent will pay for almost any class you care to take. Just be smart and check your company's policy before asking your boss to cover your scuba-diving degree that includes a work-study semester in Tortola.

If there is no formal education reimbursement policy, create one

If your employer doesn't offer an education benefit (maybe you work for a small family enterprise, and Mom and Pop never considered it), write up a request. To encourage employers to help with paying for college, the federal tax code allows businesses to deduct as much as $5,250 a year in tuition for work-related courses. Best of all, you don't pay taxes on your education assistance.

It's fairly easy for almost any employer to set up an Employer Assistance Program, and of course you will help as much as possible, right?

What about online education?

You can make a case that getting your degree or certificate through online education is great use of your time and more efficient. Online studies can mean that you won't be leaving the office early or coming in late to make it to lectures. This will be less disruptive to your co-workers, and the degree quality should not be an issue. In fact, a survey by Zogby International found that that 83 percent of CEOs and small-business owners who are familiar with online education or distance learning believe that online degrees are as credible as those earned on a college campus.

Read the fine print

In many companies, employees are required to stay one year after completing their degree programs. So if you hate your job or company, you might want to leave for greener pastures before embarking on your educational venture. In addition, before enrolling in any education program be sure that you know, in writing, what would happen to your reimbursement if your company were to lay you off or if you voluntarily terminate your employment.

Be as awesome as possible

Many firms consider tuition assistance a privilege, not a right. Employees who get help paying for college must at least be in good standing and it couldn't hurt to turn it up a notch. You know the drill: in early, out late and laugh at the boss' jokes. If your firm has no formal policy you may have to go an extra mile or ten to get what you want--pointing out that education assistance helps with employee retention only works if you are someone that your employer wants to retain, right? Be prepared to make a case for every class or program that you want help paying for--that the skills you learn will make you a better employee now and prepare you for advancement later.

About the Author
Gina Pogol writes about finance and careers. In addition to a decade in mortgage lending, she has worked as a business credit systems consultant for Experian and as an accountant for Deloitte. She graduated with High Distinction from the University of Nevada with a BS in Financial Management.

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