How SECURE 2.0 Helps Employees Build Stability and Plan Ahead

As the needs and expectations of today’s workforce continue to evolve, many employers are rethinking the kinds of benefits they offer. Traditional perks like health insurance and retirement plans remain essential, but employees are increasingly looking for solutions that address real-life financial pressures. Two newer provisions in the SECURE 2.0 Act are designed to do exactly that: the 401(k) student loan match and pension-linked emergency savings accounts (PLESAs).

These additions give employees more flexibility while helping businesses strengthen recruitment, retention, and overall financial wellness across their teams.

Helping Employees Make Progress on Debt and Retirement

For many workers—especially those early in their careers—student loans can be a major barrier to saving for the future. Historically, employees who focused on paying down debt often had to forgo contributing enough to their 401(k) plans to receive an employer match. This left them missing out on valuable retirement savings during critical earning years.

The SECURE 2.0 student loan match eliminates that dilemma. Under this provision, when employees make qualifying student loan payments, employers can match those payments with contributions to the employee’s 401(k), just as if the employee had contributed directly to the retirement plan.

This provides several important benefits:

• Employees no longer have to choose between paying off debt and building retirement savings.
• Workers managing their own student loans—or repaying loans taken out for a child or dependent—can continue progressing toward long-term financial goals.
• Employers can demonstrate an understanding of the real financial pressures their teams face, which strengthens trust and loyalty.

The employer still determines the structure of the match and how to collect proof of loan payments. All existing vesting, eligibility, and administrative rules for traditional 401(k) matches still apply. While this benefit is optional, it is becoming increasingly popular across industries as organizations expand their financial wellness initiatives.

In competitive hiring markets, this feature can also serve as a strong differentiator. Younger job seekers in particular may be drawn to companies that recognize and support their efforts to manage significant debt while planning for the future.

Creating Short-Term Security with Emergency Savings Accounts

The SECURE 2.0 Act also introduced pension-linked emergency savings accounts, more commonly known as PLESAs. These accounts are designed to help employees build a small, accessible emergency fund directly within their workplace retirement plan.

The purpose is straightforward: to reduce the need for employees to dip into long-term retirement savings—or turn to high-interest credit—when unplanned expenses come up.

Key features of PLESAs include:

• They operate as Roth-style accounts, funded with after-tax contributions.
• Eligibility is limited to employees who are not considered highly compensated.
• Workers can save up to $2,500, although employers may choose a lower limit.
• Once the account reaches the cap, additional contributions are either paused or redirected to the employee’s main retirement plan.

Withdrawals are designed to be simple and stress-free. Employees can take out funds at any time, and they can make at least one withdrawal per month. The first four withdrawals each year must be processed without any fees. This makes the account especially helpful for individuals who are still building healthy savings habits or who may struggle to manage surprise expenses.

If an employee leaves the company, they can roll the PLESA into a Roth IRA or take the funds as a cash distribution.

Employers also have the option to automatically enroll eligible workers at a default contribution level—but only if employees provide written consent in advance. Matching contributions to the retirement plan can be offered as an added incentive but are not required.

Overall, PLESAs serve as a practical tool that strengthens short-term financial resilience without undermining long-term retirement savings goals.

Why These Options Matter for Employers

Together, the student loan match and PLESA features address the financial realities many employees face every day. They help bridge the gap between immediate financial challenges and future planning—something that can lead to a more engaged, confident, and loyal workforce.

Providing these benefits sends a clear message: your organization understands the pressures employees encounter outside the workplace and is committed to supporting their overall financial stability.

These features can also reduce employee stress, a factor that directly affects productivity, morale, and long-term retention. The student loan match lets workers move forward with retirement savings even while tackling significant debt. At the same time, PLESAs provide a layer of protection when life’s unexpected costs come up.

By implementing both tools, employers can offer a more holistic approach to financial wellness—one that supports employees’ short-term needs and long-term goals alike.

Building a More Forward-Thinking Benefits Strategy

For HR leaders and business owners, these SECURE 2.0 provisions offer opportunities to modernize benefits in ways that genuinely meet the needs of today’s workforce. While the changes support compliance efforts, they also make it easier to build benefit packages that feel relevant and meaningful.

Whether you're hoping to boost retention, stand out in a competitive hiring landscape, or simply promote better financial wellness across your team, these tools can help you move closer to those goals.

If you're considering whether student loan matching or emergency savings accounts would be a good fit for your organization, we’d be glad to talk through the details. Our team can help you explore your options and develop a benefits strategy that supports both your employees and your business.