Walgreens Announces New Student Loan 401(k) Match Program

Rhea-AI Summary

Walgreens announces the launch of the Student Loan 401(k) Match Program, set to begin in January 2025. This innovative benefit allows eligible team members to qualify for company 401(k) match contributions while paying down their student loans. The program aims to address the financial burden of student debt, particularly among pharmacy team members, where over half face educational debt.

Key features of the program include:

• Matching eligible student loan payments up to 4% of eligible pay
• Eligibility generally after one year plus 1,000 hours of service
• Enhanced Pharmacy Educational Assistance Program (PEAP) offering up to $40,000 in tuition assistance

This initiative reflects Walgreens' commitment to supporting team members' financial well-being and career growth, positioning the company as a leader among large employers in addressing student loan debt.

Positive

• Introduction of Student Loan 401(k) Match Program to support employee financial well-being
• Potential to attract and retain talent, especially in the pharmacy sector
• Enhanced Pharmacy Educational Assistance Program (PEAP) offering up to $40,000 in tuition assistance

Negative

• Program implementation not starting until January 2025, potentially delaying immediate benefits
• One-year work commitment required for each year of PEAP award received

Insights

Human Resources Expert

The introduction of Walgreens' Student Loan 401(k) Match Program is a strategic move to address employee financial wellness and retention. This innovative benefit tackles two critical issues simultaneously: student loan debt and retirement savings. By allowing employees to receive 401(k) matching contributions while paying down student loans, Walgreens is effectively doubling the impact of each dollar spent on loan repayment.

This program could significantly enhance Walgreens' ability to attract and retain talent, particularly in the competitive pharmacy sector. With the average pharmacist debt at $170,000, this benefit directly addresses a major financial concern for a key employee demographic. The long-term impact could include improved employee satisfaction, reduced turnover and potentially lower recruitment costs.

The enhanced Pharmacy Educational Assistance Program (PEAP) further strengthens Walgreens' position in the labor market. Offering up to $40,000 in tuition assistance with a work commitment creates a pipeline of future pharmacists, potentially reducing future staffing challenges.

Financial Analyst

While this program represents a significant investment in employee benefits, it's likely to yield positive financial returns for Walgreens in the long run. The cost of implementing this program should be weighed against the potential savings from reduced turnover and increased productivity due to improved employee financial wellness and loyalty.

Investors should note that this move aligns with broader market trends towards more comprehensive employee benefits packages. It could positively impact Walgreens' ESG (Environmental, Social and Governance) scores, potentially attracting socially conscious investors and improving the company's reputation.

However, the financial impact won't be immediate, as the program starts in January 2025. Shareholders should monitor for any updates on projected costs and expected benefits in upcoming financial reports. The program's success could set a new standard in the retail pharmacy sector, potentially influencing competitors to follow suit and reshaping industry-wide benefit structures.

Program allows eligible team members to prioritize paying down student loans while contributing to their financial future

DEERFIELD, Ill.--(BUSINESS WIRE)-- Walgreens, the leading independent retail pharmacy and healthcare provider, is announcing today the launch of the Walgreens Student Loan 401(k) Match Program. This new benefit, available beginning in January 2025, will allow team members to qualify for company 401(k) match contributions as they pay down their student loans.

Walgreens announces new Student Loan 401(k) Match Program which will allow team members to qualify for company 401(k) match contributions as they pay down their student loans. (Photo: Business Wire)

“We understand the burden student loan debt places on many of our team members, and this program empowers us to make a lasting impact on their financial well-being,” said Elizabeth Burger, EVP and Chief Human Resources Officer, WBA. “With this new benefit, our team members are no longer faced with the difficult choice between managing their student loan debt and investing in a secure financial future – now they can confidently do both.”

With nearly 43 million Americans struggling with student loan debt, Walgreens is proud to be a leader of large employers offering team members this new option. Roughly 30% of Walgreens team members are facing financial debt from higher education –including more than half of our pharmacy team members –and according to the American Association of Colleges of Pharmacy, pharmacists have an average student loan debt of $170K.

How It Works

The Walgreens Student Loan 401(k) Match Program treats enrolled team member student loan payments like contributions to the Walgreens Retirement Savings Plan “401(k).” Walgreens matches eligible student loan payments up to 4% of eligible pay. Team members are generally eligible for company matching contributions after one year plus 1,000 hours of service.

Additional Educational Benefits

Walgreens is committed to supporting its team members’ financial well-being and career growth, which is why the company also recently enhanced its Walgreens Pharmacy Educational Assistance Program (PEAP). PEAP provides tuition assistance each year when eligible team members are enrolled in a professional pharmacy program while working for Walgreens as a pharmacy intern. For all years combined, the awards can be as much as $40,000 in total.

In exchange for each award, pharmacy students are required to sign an agreement that includes a one-year work commitment as a registered pharmacist at Walgreens. The total work commitment period is the total number of years for which a pharmacy student receives an award under this program.

Walgreens is dedicated to providing comprehensive benefits that address the diverse needs of its team members. For additional information on benefits and career opportunities at Walgreens, please visit jobs.walgreens.com.

About Walgreens

Walgreens (www.walgreens.com) is included in the U.S. Retail Pharmacy and U.S. Healthcare segments of Walgreens Boots Alliance, Inc. (Nasdaq: WBA), an integrated healthcare, pharmacy and retail leader. True to its purpose of “more joyful lives through better health,” Walgreens has a more than 120-year heritage of caring for communities and providing trusted pharmacy services, and today is playing a greater role as an independent partner of choice offering healthcare services that improve care, lower costs, and help patients. Operating nearly 9,000 retail locations across the U.S. and Puerto Rico, Walgreens is proud to serve nearly 9 million customers and patients daily. The company’s pharmacists are playing a more critical role in healthcare than ever before, providing a wide range of pharmacy and healthcare services, including those that drive equitable access to care for some of the nation’s most underserved populations. Walgreens offers customers and patients a true omnichannel experience, with fully integrated physical and digital platforms designed to deliver high-quality products and healthcare services. Within the U.S. Healthcare segment, Walgreens portfolio also includes businesses in primary care, multi-specialty, post-acute care, urgent care, specialty pharmacy services, population health and provider enablement.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241002051655/en/

Megan Boyd

media@walgreens.com

Source: Walgreens

FAQ

When will Walgreens (WBA) launch its Student Loan 401(k) Match Program?

Walgreens will launch its Student Loan 401(k) Match Program in January 2025.

How does Walgreens' (WBA) Student Loan 401(k) Match Program work?

The program treats enrolled team members' student loan payments like contributions to the Walgreens Retirement Savings Plan, with Walgreens matching eligible student loan payments up to 4% of eligible pay.

What is the eligibility criteria for Walgreens' (WBA) Student Loan 401(k) Match Program?

Team members are generally eligible for company matching contributions after one year plus 1,000 hours of service.

How much tuition assistance does Walgreens' (WBA) Pharmacy Educational Assistance Program offer?

Walgreens' Pharmacy Educational Assistance Program (PEAP) can provide up to $40,000 in total tuition assistance for eligible team members enrolled in a professional pharmacy program.