Written by Howard Tullman
Published on Jan. 04, 2016

                            The Next Big Employee Perk

                Sometimes you just smack yourself in the head and say to yourself “why didn’t I think of that?”  It’s so obvious and so right. But, of course, that’s what makes great entrepreneurs.  Entrepreneurs don’t know what’s impossible or what they can’t do. They don’t color within the lines or stay stuck in their silos. They see what everyone else has seen (and lamented for years); they think about it differently; and they bring a new perspective/approach to the problem.  And then – in retrospect – it’s blindingly clear to all of us.  As Nelson Mandela used to say: it always seems impossible until it’s done.

            For years, I’ve been depressed by the fact that millions of people are trapped in crappy, dead-end jobs (yearning to be free to try to do something meaningful and important) because they are imprisoned by their need to preserve their company-based health insurance coverage for themselves and their families. It’s hard to imagine the economic impact and the creative forces that would be unleashed if the futures of so many weren’t fettered by the bonds of the bozos who run the health insurance scams in this country. (See ) This is in part why 1871 became the first mega-incubator in the world to offer health insurance programs for its member companies although – truth be told – almost all of our entrepreneurs think they’re immortal and indestructible as well so they’re more concerned about innovation than insurance in their day-to-day lives.

            Now I’m not naïve and I do realize that “portable” health insurance and increased employee mobility isn’t exactly a high priority on the lists of any of the major corporations in this country who are plenty concerned as it is with (a) motivating and hanging on to their good young people and also with (b) trying to figure out how they can attract the next several generations of smart, skilled newbies to their big, old and somewhat tired businesses. I don’t see their HR departments rushing any time soon to get rid of the insurance handcuffs.

            But, there’s actually good news out there for everyone and a new solution that will serve both the existing young employee workforce and also be a sure-fire attractor for new talent. Forget free Frosty Melts, gym dues and mid-day massages – the new great employee perk – for businesses big and small – is right before our eyes. And the best news is that it’s something you can get started on tomorrow whether your revenues are billions or bupkes.  So even the big guys can do some good for a change by doing good for their employees.

            In my daily conversations with dozens of techies in their 20s and 30s, it turns out that the real problem for almost all of them is not insurance, it’s their substantial student debt. Frankly, no one cares about their 401(k) when they’re worried about foraging for food on a weekly basis. In fact, a staggering number of young workers these days don’t make any 401(k) contributions even when their employers are willing to match them.

            So a new company based at 1871 (Peanut Butter) has come up with a simple, straightforward way for businesses to help their employees (new and old) get this brutal burden off their backs. Keep in mind that 40 million Americans have student debt right now and it averages over $30,000 a person. So this isn’t just a new employee recruitment tool; it’s also a powerful and proven retention tool to help keep your proven people around the place years longer.

            And believe me, in this competitive recruitment market (where only a few companies can afford ridiculous signing bonuses and other incentives), you don’t want your company to be the last one on the block to be offering this important helping hand to your best employees and hottest prospects.

            Talk about a magnet for Millennials – this is the real deal – and these kids in particular are saddled with more student debt than any generation that came before them. Over 70% of the Class of 2015 graduated with student debt.

            By 2020, Millennials will represent almost 50% of the total U.S. workforce. Surveys already indicate that most of the major employment decisions that new graduates are making are informed by the impact of their choices on their student debt including industry selection, job acceptances, and relocation options. If, as an employer, your benefits offerings aren’t in the competitive set; you can bet that you’ll be on the outside looking in at the competition as the best candidates head elsewhere.

            Peanut Butter ( ) is a benefits administration business that makes it easy for employers of any size to make contributions to help their employees pay off their student loans. It’s all online and everything from establishing the plan, signing up qualified employees, confirming loan amounts and determining contribution amounts, and even routing, tracking and documenting the payments being made are all incorporated with detailed real-time reports. Treasury management services are provided by a large and long-established Chicago-based financial institution.

            Needless to say, this is an almost impossible task for an individual company regardless of their resources to undertake (even with the best of intentions) because every single employee’s story is different and there are literally tens of thousands of different lenders, payers, borrowers, etc. It’s an ideal use case for a one-stop, cloud-based platform business where all the investigation, standardization, documentation, payment programs and infrastructure are already built and in place so that it becomes a turnkey solution for each of the businesses who want to provide the service to their employees.

            You could always try to do this yourself, I guess, but it would be a stupid use of your energy, time and resources when the solution is already sitting there. And an even dumber thing to do would be to wait until everyone else is already offering the benefit to their people. Just remember the old adage – when it’s obvious that you need to change; it’s probably already too late to do so.


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