Earning your college degree while working is a smart career move. It increases your value to your employer (and in turn, your job security), and it improves your career trajectory.
By continuing to work while getting your degree, you can maintain your income, reduce your reliance on loans – and if your employer offers a Tuition Assistance Program, you could even come out ahead.
What Is a Tuition Assistance Program?
Simply put, a Tuition Assistance Program is a program, generally run through an employer’s human resources department, where employees can take college courses paid for by that employer.
According to the IRS, you can exclude up to $5,250 of educational assistance benefits each year. This means your employer will not include those benefits with your wages, tips, and other compensation shown on your Form W-2. This also means that you do not have to include these benefits on your income tax return.
Step One: Research
Before you can take advantage of employer-sponsored tuition assistance, find out if there is a qualified program where you work. Your HR department would be the best place to start. If your employer does offer one, be sure to get a copy of the written policy.
Here are some key questions to ask HR:
- What kind of college courses are eligible? Undergraduate or graduate? Credit-bearing or non-credit bearing? Are online college classes acceptable?
- How are college courses reimbursed? Does the employer pay for the course up front? Or will you need to pay the tuition first and request reimbursement upon course completion? To whom will you submit the request for reimbursement? On a semester basis? On a per-course basis?
- Is there a GPA requirement? What happens if you fail a class or must drop out?
Step Two: Sign-Up for Courses
The number of companies offering education benefits has been growing over the last decade. There’s a good chance that even if your employer didn’t offer a tuition reimbursement plan in the past, they do now. It’ll be worth your time to find out.
Before you sign up for courses, here’s what you’ll need to know:
- Which courses are eligible? Some employers may require that the courses you take be directly related to your job; others allow any courses; others still may require only business-related courses. It all depends on your employer and the company’s policy.
- Are there approved providers? Your employer might work with approved college course providers to administer their employer sponsored educational program. Verify if you need to sign up through your employer or if you can go to the course provider
- Do you need to get approval from a manager? Some employers also require a sign-off from a manager or supervisor. If that’s the case, he or she may be the one to determine if your courses are job-related, and therefore eligible for reimbursement.
- What is the enrollment process? In most cases, you will need to notify and sign up for your employer’s tuition reimbursement program first before you enroll at any institution of higher learning. Before you pay any tuition, verify that the courses you plan on taking are eligible for reimbursement.
Step Three: Maximize your Benefits
Once you’ve gained approval for your educational plan from your employer, you’ll want to maximize every dollar of your benefit. Here’s how to get the most out of your tuition assistance program:
- Take courses eligible for college credit. Upgrade your skills and get college credit eligible for transfer into accredited degree programs.
- Consider low-cost options. StraighterLine, for example, offers a $99-per-month subscription, combined with affordable one-time course fees that can help you make significant headway in a degree program without taking on the added burden of loans. StraighterLine also offers a Full Year bundle that offers students access to 10 courses for an entire year for just $1299, so it’s possible that you could use your employee benefits to completely pay for a full year of college!
- Reduce your risk. If you are unsure about the feasibility of going back to school, consider taking a free trial to gauge whether or not you’re ready to fit school into your work life. Starting college outside college is a great way to mitigate risk.
When taking advantage of your employer’s assistance program, pay attention to the fine print. According to the IRS, there is a list of services you can and cannot use your educational benefits for. Your employer may also have additional requirements.
Step Four: Measuring Progress
Whether you are pursuing your undergraduate or graduate degree, you’ll want to evaluate if your career is moving in the right direction. You might find you’re now ready to take on new projects at work or apply your new skills in a different area of the business. You may even now be eligible for a promotion.
Take Advantage of your Employer Sponsored Educational Benefits
If your employer offers a tuition assistance reimbursement program, you are fortunate. Be sure you take advantage of this opportunity to invest in yourself, and don’t leave money on the table. After all, the benefit of education is forever.