There is more that makes up your salary than just the money you earn in wages. Many employers offer to pay for college tuition to support their employees. The United States Department of Defense offers tuition assistance to members of the military up to $250 per credit hour and a fiscal year cap of $4,500. Soldiers, like civilian employees, who do not use their allocated tuition assistance money are just throwing away a part of their annual income. You earned that payment as part of your salary, and you are just wasting part of your paycheck if you do not use it.
There Is More To Salary Than Just Your Income
The salary that you earn from your job comes in many forms. Benefits are a large portion of your paycheck. Some of the other benefits of your total compensation that are included in your total salary package are health insurance benefits, social security and other insurances, contributions to your retirement plan made by your employer, housing allowance, subsistence allowance, special skills pay, vacation days, personal time, sick leave, stock options, company cars, gym memberships, catered lunch, and the list goes on and one.
Many Employers Offer Tuition Assistance
The amount of support that companies choose to provide their employers is often determined by government guidelines. According to IRS regulations, employers can provide up to $5,250 to each employee per year on a tax-free basis for educational expenses. Any additional employer tuition assistance that is provided to employees is taxed. So, many employers stay within the IRS limit.
Huge Cost Not Using Your Employer’s Tuition Assistance
If you were just starting out and did not have a Bachelor’s Degree, you could save yourself tens of thousands of dollars by earning your college degree with the help of your employer. The average cost of a 4-year public college is $8,150 per year with in-state tuition. Over the course of four years, you could save yourself over $32,600 for a public college education. If you put your education on a credit card with only 12% annual interest (horrible idea), then it will take you over thirty years of just paying the minimum payments to pay that debt off. Over the course of those thirty years, you would have paid over $32,000 in interest payments alone. The amount of savings is truly impressive if you continue your education past your Bachelor’s Degree as well. And, if the savings is not enough to convince you, you can expect to earn approximately $25,000 more per year with a Bachelor’s Degree than just a high school diploma. Earning a graduate degree will net you another $20,000 per year on average.
Details About Military Tuition Assistance
Tuition Assistance (TA) program provides financial support for off-duty college courses, education programs, and certifications in support of a Soldier’s professional and personal self-development goals. Tuition Assistance in the military is available for college courses that are offered in both the classroom or by distance learning via the internet. The courses must be offered by colleges that are registered through the military system and are accredited by accrediting agencies that are recognized by the U.S. Department of Education. For more information, check out the Army’s website GoArmyEd.com and the the Navy College Program.
What if I told you that I decided to not accept my housing allowance that the Army gives to me for my off post quarters? What if an employee refused to accept the use of a company car in the civilian sector? The same thing is going on every day in the military and in corporate America when employees do not use their college tuition assistance that their employer provides. You are throwing away a portion of your salary. You earned it. Use it. Would you turn down free matching contributions to your 401k retirement plan? Of course not, and you should not turn down free tuition assistance either.
Side Note – This article is a part of GoBankingRates.com’s “Personal Finance Group Writing Project” on education and wealth. Stay tuned for links to other great articles from some more writers and details on how to vote for your favorite!
Check out the article I wrote on Own The Dollar as well for the project, “Five Ways To Save Over $30,000 On The Cost Of A College Education”
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some employers even reimburse tuition and books for part time employees. a company i worked at while i was in college reimbursed me up to $1500 per year and i was working about 25 hours per week (they reimbursed more for full-timers). not bad right?! however, i was only 20 when i started working there so i didn’t have the knowledge to ask and missed the first year’s opportunity. i think a co-worker eventually asked me if i was getting reimbursement. some companies will pay willingly…as long as you ask them for it!
I wish my employer reimbursed tuition. Maybe I’ll try the “squeaky wheel” theory and put together a proposal for something relating to my field that would cost $5,250 (or at least for which they could pay $5,250 and have me pay the rest). I’ll let you know if they laugh at me (and how hard, if they do).
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