Across the United States, many adults are juggling two major financial priorities at the same time: paying down student loans and saving for retirement. With more than 43 million borrowers still carrying student debt well into midlife—and in some cases even into their 60s—it’s easy to understand why retirement planning often takes a back seat.

At the same time, surveys consistently show that a large share of Americans feel behind on their retirement goals. This is especially true for high-net-worth professionals and people in their peak earning years, who often face competing demands on their income. With Financial Aid Awareness Month taking place this February, it’s a great opportunity to look at how both goals can move forward together through intentional planning.

Whether you’re repaying Parent PLUS loans, tackling your own student debt, or managing education costs for a child, here’s how you can stay on track with retirement while keeping loan repayment under control.

Take Advantage of Employer Matching Through the SECURE 2.0 Act

A major new resource for borrowers is the student loan payment matching feature introduced by the SECURE 2.0 Act. If your employer offers this option, every qualifying loan payment you make could be matched with a contribution to your 401(k) or comparable retirement plan—even if you aren’t contributing to your retirement account at the same time.

This benefit is powerful because it allows you to grow your retirement savings while staying focused on your loan repayment goals. It also lets you benefit from compound growth in your retirement account without having to redirect money away from reducing your loan balance. For professionals early or mid-career, this can be especially valuable as it supports retirement accumulation without slowing your progress on debt.

If you’re unsure whether this benefit is available to you, reach out to your HR department or your retirement plan administrator. They can walk you through eligibility requirements and enrollment steps.

Be Intentional About How Extra Loan Payments Are Applied

Making additional payments toward your student loans can shorten your repayment period and decrease overall interest—but only if those payments are used correctly. Many loan servicers automatically treat extra payments as advance payments toward future monthly bills, which does little to lower the principal balance of your loan.

To make your extra payments work in your favor, you’ll need to request that they be applied directly to your principal. This often requires a written request, but the impact can be significant: applying extra funds toward the principal helps reduce how much interest accrues over time and can meaningfully cut down the life of your loan.

If you’re not sure how your payments are being processed, it’s worth calling your servicer and confirming. Keep a record of your request to ensure payments are handled correctly moving forward.

Lower Monthly Loan Payments Through Pre-Tax Retirement Contributions

Borrowers on income-driven repayment (IDR) plans may be able to reduce their monthly student loan payments by contributing to a pre-tax retirement account such as a traditional 401(k), 403(b), or SIMPLE IRA. Because IDR payments are calculated based on your adjusted gross income (AGI), lowering your AGI through retirement contributions also lowers your required monthly loan payment.

This approach offers a double benefit: you’re investing in your future through tax-deferred savings while also reducing your student loan burden in the present. For borrowers working toward Public Service Loan Forgiveness (PSLF) or another long-term forgiveness pathway, lowering your AGI could even increase the total amount eventually forgiven.

This strategy can be especially helpful for financial advisors, wealth and retirement professionals, and high-net-worth individuals who are balancing multiple goals and income streams.

Factor Long-Term Forgiveness Into Your Broader Financial Strategy

For those eligible for forgiveness programs that span 10 to 25 years, it’s worth considering whether paying off loans aggressively is the best use of your resources. While eliminating debt quickly can feel rewarding, it may reduce the benefits you could receive from a forgiveness program and leave less flexibility for building retirement savings.

If forgiveness is likely in your future, increasing your retirement contributions may help lower your AGI, decrease your monthly payment, and ultimately allow a larger share of your loan balance to be forgiven. Meanwhile, your retirement accounts continue to grow, putting you on steadier footing for long-term financial health.

Stepping back to evaluate your overall financial picture—and how each piece interacts—can uncover opportunities to maximize both retirement savings and debt relief.

Smart Planning Helps You Make Progress in Both Areas

You don’t have to choose between saving for retirement and paying off student loans. With a thoughtful strategy, you can advance both goals at the same time. This may involve confirming whether your employer offers student loan 401(k) matching, ensuring that extra payments are applied to your principal, increasing pre-tax retirement contributions if you’re using an IDR plan, or reviewing your potential for loan forgiveness.

Working with a financial advisor can be particularly useful if you have complex income, multiple priorities, or high-net-worth considerations. An advisor can help you examine your numbers, consider tax implications, and identify the most effective path forward.

The Bottom Line: You Can Build Retirement Savings While Managing Student Debt

The idea that you must choose one goal over the other is outdated. With tools like the SECURE 2.0 Act, income-driven repayment options, and forgiveness programs, it’s increasingly possible to balance both priorities successfully.

Financial Aid Awareness Month is a good reminder that financial clarity matters at every age—not just for students. If you’re navigating student loan repayment while preparing for retirement, now is an ideal moment to reassess and refine your approach.

If you’d like guidance with your financial picture or support mapping out a plan, reach out today. A personalized strategy can help you lessen your loan burden, strengthen your retirement outlook, and move forward with confidence.