For many adults in the United States, managing student loan debt and preparing for retirement are two of the biggest financial challenges they face. With more than 43 million people still repaying student loans—sometimes well into their 40s, 50s, and beyond—retirement planning can easily get pushed to the background.

At the same time, a significant number of Americans feel they’re not saving enough for retirement. This is especially true for mid-career earners and high-net-worth (HNW) individuals juggling multiple financial commitments. With Financial Aid Awareness Month taking place this February, it’s an ideal opportunity to take a closer look at how student loan repayment and retirement savings can comfortably coexist with thoughtful planning.

Whether you're repaying Parent PLUS loans, managing your own student debt, or supporting a child’s educational costs, here’s how you can continue building retirement security without sidelining your loan obligations.

Take Advantage of Employer Matching Under the SECURE 2.0 Act

One of the most impactful updates for borrowers is the option for employers to match student loan payments under the SECURE 2.0 Act. If your employer offers this feature, each qualifying loan payment you make can trigger a contribution to your 401(k) or similar retirement plan—even if you’re not currently contributing to it yourself.

This benefit is valuable because it helps you grow retirement savings while staying focused on paying down your loan balance. It also gives you access to the long-term advantages of compounding investment growth without pulling additional dollars away from your debt repayment plan. This is especially useful for early- and mid-career professionals who want to keep making progress on their loans without sacrificing retirement momentum.

To get started, reach out to your Human Resources department or retirement plan administrator to confirm whether your employer participates in this program and learn how to enroll.

Be Intentional About Extra Loan Payments

Making additional payments toward your student loans can be a smart tactic to shorten your repayment timeline—if those payments are applied correctly. Many loan servicers automatically put extra payments toward future bills rather than reducing your principal balance, which is the amount you originally borrowed.

While this may make you appear ahead on payments, it doesn’t decrease the interest you’ll accumulate over time. To get the full benefit of paying extra, you’ll need to request in writing that your servicer apply any overpayments directly to your principal.

This small but important step can noticeably reduce your total interest costs and help you pay off your loans sooner. If you’re not sure how your extra payments are being used, contact your servicer and keep documentation of any requests.

Lower Student Loan Payments Through Retirement Contributions

Borrowers using income-driven repayment (IDR) plans can reduce their monthly student loan payments by contributing to pre-tax retirement accounts such as a traditional 401(k), 403(b), or SIMPLE IRA. Since IDR payments are calculated using your adjusted gross income (AGI), lowering your AGI means your loan payment will drop as well.

This approach provides powerful dual benefits: you’re building retirement savings on a tax-deferred basis while immediately lowering your loan liability. For individuals pursuing Public Service Loan Forgiveness (PSLF) or other long-term forgiveness options, this strategy can also increase the amount that eventually gets forgiven.

For registered investment advisors (RIAs), wealth and retirement professionals, and HNW earners who often navigate layered financial needs, this technique can be especially effective in optimizing both long-term and short-term planning.

Include Long-Term Loan Forgiveness in Your Financial Strategy

Forgiveness programs with terms that range from 10 to 25 years can significantly influence your financial approach. While paying off loans quickly may feel rewarding, it may not always be the most beneficial strategy if you’re on a path toward forgiveness.

If forgiveness is on the table for you, increasing your retirement contributions may serve you better in the long run. Doing so can lower your AGI, reduce your monthly loan payments, and potentially increase the portion of your debt that will be forgiven. Meanwhile, your retirement contributions continue growing tax-deferred, helping you stay aligned with your financial goals.

Looking at your full financial picture can help you determine whether aggressive repayment or strategic contributions make more sense for your situation.

Smart Planning Helps You Move Forward on Both

Balancing student loans and retirement savings doesn’t have to be a choice between one or the other. By using strategies that fit your income level, tax considerations, and long-term goals, you can advance both priorities. This might involve confirming your eligibility for employer student loan matching, ensuring extra payments go directly to principal, increasing pre-tax retirement contributions under an IDR plan, or evaluating whether you qualify for loan forgiveness programs.

Partnering with a financial advisor can be especially helpful for those juggling multiple goals, managing complex income, or navigating HNW scenarios. An advisor can help you evaluate the numbers, understand the tax implications, and choose the most efficient strategies for your situation.

The Bottom Line: You Don’t Have to Choose

It’s a common misconception that you must prioritize either student loan repayment or retirement planning. In reality, with smart financial strategies and the support of programs like the SECURE 2.0 Act and income-driven repayment, it’s absolutely possible to pursue both.

Financial Aid Awareness Month is a reminder that financial education benefits everyone—not just students. If you’re working to balance loan obligations while building a secure retirement, now is an excellent time to reassess your strategy and adjust where needed.

If you’d like guidance reviewing your financial situation or planning your next steps, reach out today. A tailored plan can help you reduce debt, strengthen your retirement outlook, and move forward with confidence.