You may have already read Daniel’s story, which illustrates one of the many reasons individuals are trying to build accessible savings (you can call them emergency savings or personal savings too). In short, it comes down to the idea of dignity and self-determination, not just preparing for the unexpected.
But if you’re an employer, why should you provide accessible savings as a benefit? Here are six simple reasons why:
1. Saving works – and employers know this. Companies are already offering benefits to cover retirement savings, health savings, and education because they know their employees are thinking about their futures. But here’s the difference: this alphanumeric soup of savings benefits is tough for employees to navigate and comes with many restrictions and penalties that may hinder someone who wants to… just save! Having a simple, accessible savings benefit invites everyone to put money away for their personal goals and, yes, an emergency fund too.
2. Employees are loyal to companies that invest in them. Emergency savings and personal savings are top of mind, especially for folks who are focused on achieving financial wellbeing in the near-term. According to several studies, providing similar benefits have led to better and longer retention. It’s simple to understand why – as one individual told us, “when a company invests in me, I am willing to grow my career with them.”
“When a company invests in me, I am willing to grow my career with them.“Frontline Employee at a Healthcare System
3. Accessible savings creates more reliability for companies. Having cash on hand thanks to a savings program matters, especially when a car breaks down or there’s a home emergency and people can’t get to work. We’ve often heard from general managers and HR managers that shifts go unfilled when workers can’t show up to work, causing production issues and undue stress for those who have to cover the shift. Ensuring that workers have savings that they can access easily for those moments helps address unintended tardiness and absenteeism.
4. A less stressed workforce is more productive. We’ve all heard stories about how stress impacts productivity, but did you know that financial matters or money issues are the TOP source of stress for workers? Even with COVID, people are first thinking about how they’re going to make rent and take care of their families, and then thinking about their personal safety. That stress travels with employees to the workplace, where they may make costly accidental mistakes on the production line, during a delivery, or during a health procedure – whatever the work may be.
5. Employers can lead the way toward greater workforce financial security. According to AARP, nearly nine in ten people said they would save towards an unrestricted rainy day fund if the employer to offer it as a benefit and contribute a small amount. That staggering potential participation rate focused on near-term financial needs – not just retirement – demonstrates that Americans are already thinking about their personal finances. They just need some help to actionably achieve their goals. Employers have an opportunity to engage those existing sentiments and weave them into company culture.
6. Helping employees save creates a positive cycle that benefits everyone. People build accessible savings so they can be prepared for whatever comes their way, rain or shine, rather than growing a pile of money indefinitely. Researchers at Aspen Institute’s Financial Security Program talk about this preparedness and routine withdrawals from savings accounts as “The Cycle of Savings”. When employers actively help their employees work towards these emergency savings and personal savings goals, employers increase workforce financial security while building affinity.
These are just six of many reasons why employers should equip their employees with accessible savings. Convinced that you should be offering Sunny Day Fund™ to your employees? Contact us and stay tuned for more posts from our team as the Sunny Day Fund™ community continues our savings journey.