The Definitive Guide to Learning & Development Stipends

A learning and development stipend is an amount of money given to employees for them to spend on learning initiatives to help them advance their skills.

Updated November 14, 2023 by Sarah Bedrick

 
 

Learning and development stipends for employees have been gaining in popularity over the past few years, especially as a way to both improve employee productivity and increase retention.

But, as more companies turn to L&D perks to better solve for the unique needs of their employees, more questions arise. 

That's why we developed the definitive guide to everything you need to know about these education-forward, people-first stipends:

Here's what is covered in this guide:

  1. What is a learning stipend
  2. Why use learning & development stipends
  3. The data on learning stipends
  4. How other companies set up learning stipends
  5. How to make the most of your learning stipend
  6. What people spend their stipend on
 
 

What is a learning stipend?

First, a definition:

A learning or education stipend is a sum of money given to employees for them to spend on learning initiatives that are relevant to them and their needs. 

Further details on what they are:

  • Learning stipends can be given out on a monthly, quarterly, semi-annual, or annual basis. 
  • They are nontaxable items.
 
 
unique learning and development stipend purchases
 

Example of a learning stipend

To the left is a screenshot from Buffer's $20/month learning and development stipend.

To achieve their learning goals, it wasn't just one learning platform or program that Buffer's employees used; their team spent money on 15 unique categories. 

How could an HR or People Operations professional create a program that supports this diversity of needs? 

This perfectly illustrates the power of a perk stipend or lifestyle spending accounts.

 
 
professional development stipend
 

Foster a culture of learning and continual growth with a professional development stipend

(Compt customers see 90% engagement rates!)

 
 

Why use learning & development stipends

Learning and development can take on various forms: coaching, classes, conferences, training, learning through books, and many others.

To help solve for these varied methods of learning and development, learning stipends have quickly emerged as one of the best - and most popular - forms for encouraging employees to always be learning. A learning and development stipend, rather than a formal learning platform, has really become the go-to education-based lifestyle benefits solution for HR teams because it's so much more flexible and effective than the traditional "we pick the learning process or path" for you.

Benefits of learning stipends include:

  • Employees can pick what is best for them. Some people may need to level up through classes where others may need coaching, a learning stipend lets everyone get what they need. 
  • They're flexible which allows for personalization. What one employee needs is different than another, and it can change from day to day. A learning stipend lets you fill the gap between employees and their needs.
  • More learning and development. Because you let people pick the best learning for them, they're more likely to engage with stipends: this means more usage, which means more learning.
  • Employees are happier. When you trust employees to pick what's best for them, you signify you trust them and their judgment. Trust is the most important building block of a high-functioning team.

 
 

The data on learning stipends  

Educational stipends aren't new, but like most other employee perks, there isn't too much data directly associated with them.

Below find stories, relevant statistics, and more from companies who are offering these to their employees:

  • A whopping 80% of employees said that some form of continuous learning and professional development ranked from “important” to “very important” to them. (Snacknation, 2018)
  • In a recent Gallup poll, 87% of millennials said development is important in a job. When employees, particularly millennials, are satisfied with the programs for career development that are available to them, they are more likely to remain with an employer. (Gallup, 2016)
  • Andrew Geant, cofounder of Wyzant, believes learning stipends have proven effective at boosting employee retention and even improving their recruiting capabilities in an increasingly competitive market. “In interviews, potential employees often cite the learning stipend as a top reason they applied,” Geant has said.
  • Among millennials — who make up 35% of the workforce, the largest generational group — 87% consider potential career growth and development opportunities important when considering a job offer.
 
 

8 Examples of learning stipends

There is no one-size-fits-all learning stipend as every company's size, budget, and focus on learning inis different. Check out how the culture giants below leverage the flexibility and personalization of learning stipends.

1. Slack

Employees receive $500 annually towards a personal development opportunity of their choice and $2000 annually for professional development. That’s a significant monetary investment on employee learning and development.

2. Webflow

Through Compt, Webflow offers a $1,000/year learning and development stipend for their employees.

3. Buffer

As mentioned above, Buffer spends $20/month on every employee to learn in three main ways: core learning, stretch learning, and holistic development.

4. Help Scout

Help Scout has a "Learn Something Stipend" where each employee is given $1,800 to spend annually on learning.

5. Olark

Olark has a professional development budget of $2,000/year to use on classes, books, software, conferences, etc. -- whatever helps their team learn.

6. Balsamiq

Balsamiq gives their employees $3,000/year to spend on books, classes, or travel, accommodation and fees for attending conferences.

7. Smartsheet

Smartsheet provides their employees $1,000/year to spend on learning-related items.

8. Wyzant

As noted in this Forbes piece, Andrew Geant, co-founder of Wyzant offers their employees $2,000 per year in learning stipends. 

 
 

How to make the most of your learning stipends

If you invest in your people, they will invest in you.

As famous speaker Jim Rohn once said, "When you invest in people and lift them toward their potential, they will love you for it." From career coaching to conferences and books, learning stipends let managers and employees pick the best path for them to reach their potential. 

Below are some ideas as to how your employees and your company can get the most out of your learning stipend:

Formalize it with process and documentation. 

A learning stipend that isn't documented and doesn't have a formal process only leads to confusion.

We've all been at organizations that haven't properly outlined exactly what the benefit is, what's covered, and how to take advantage. This leads to more questions for employees and more questions for HR to address.

Eliminate questions, confusion, and lop-sided support for only some people by properly documenting how much people have, how it can be used, and how to best redeem this perk. You can document this process on an internal wiki, like Atlassian or Tettra, or manage the whole process through a perk software like Compt (hey there!).

Include it in your job postings. 

Let your potential employees know that you're committed to their continued development and you make this possible by giving them a stipend to pick the best methods of learning for them. 

Set a metric for adoption or usage. 

Buffer found that about 27% of their team took advantage of their learning stipend, however, at Compt, we find that ~80% of employees take advantage of their company's monthly stipends.

Set a utilization, adoption, or participation metric that you're shooting for, and then create a process to support that.

One example of a good process is by developing training to help people managers at your company find ways to get their team members to take advantage.

Where relevant, tie back to a company value.  ❤️

Since today's labor market is crowded. With three of the six billion companies in today's US labor market being hyper-competitive, finding and keeping talent isn't easy. By having a clear and powerful mission, vision, and values (MVV), you're able to find people who have similar beliefs which will attract them to your business.

Double down on your MVV by investing in it. If you have a value of "Always be learning", then having a learning stipend tied to that really helps you walk the walk. 

 
 

What people buy with their continuous learning stipend

As we mentioned above, you can keep your stipend's spending as open or closed as you want. We find that the more you let your team decide what's best for them, the happier, more productive and empowered they will be. 

Below are some of the items people have purchased through their Learning & Development Stipends (through Compt):

  • Books & eBooks (hard copy, audio, and Kindle)
  • Certifications related to their professional field
  • Conference attendance
  • Career coaching services
  • Graduate degree programs
  • Local meetups
  • Membership fees for professional organizations
  • Networking events
  • Online courses like Udemy, Coursera, LinkedIn Learning, or a Udacity Nanodegree
  • Workshops or workshop fees related to their expertise
 
 

A perk stipend makes it possible for companies to offer more perks, with less money and ensure that they are personalized to meet the needs of their people.

Below are some of the popular types of stipends:

Sarah Bedrick

Chief Marketing Officer

Prior to Compt, Sarah worked at HubSpot for 6+ years, where she helped to build, scale, and grow the HubSpot Academy division. She is obsessed with understanding what makes a company culture great, being a career and life coach to people in tech, and creating cherished memories with her husband and two young kids. Her favorite Compt stipend category is Health & Wellness.

 
 

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