Workplace emergency savings programs and emergency savings accounts (ESAs) are becoming more and more common, especially as Secure Act 2.0 takes effect soon. As employers consider implementing an emergency savings program like Sunny Day Fund, it’s helpful to understand what to expect.
As part of a new series of case studies, we are sitting down with our earliest adopters to learn why they started offering Sunny Day Fund and how it’s going. We start with Alleghany, who was featured in Society of Human Resource Managers (SHRM)’s article on workplace emergency savings.
We offer a variety of benefits because we want employees to feel valued. Sunny Day Fund is a unique program that allows employers to encourage and support employee savings.Kate Garitz, Finance Manager, Alleghany Warehouse Company
The Client: Alleghany Warehouse Company
Alleghany Warehouse Company is a family-owned, minority-majority company located in Richmond, VA. Alleghany manages warehouse operations for a Fortune 200 consumer packaged goods company.
Kate Garitz is Alleghany’s Finance Manager in charge of all of the company’s financial transactions, including payroll and benefits.
Alleghany has been a Sunny Day Fund partner since 2020.
The Challenge: Helping Employees Deal with Financial Stress
Alleghany is a warehousing company made up of hourly employees—most of whom are forklift operators—and a smaller number of salaried office employees. Many of their employees have been with the company for decades, as Alleghany’s Finance Manager Kate Garitz tells us:
“A lot of our employees have been with us for 40+ years,” she says. “They’re very loyal to the company.”
Alleghany offers employees a variety of benefits, including paid time off and healthcare. Since 2015, Alleghany has also been offering employees the opportunity to participate in their Simple IRA plan, with a 3% yearly company match.
But the company is always looking for ways to improve its benefits offering and give employees more options—while still maintaining a positive balance sheet.
“Money is a stressor for a lot of people right now, including our employees,” Kate says. “So whatever we can do to support them, we want to do.”
Stress in the workplace can lead to increased risk and accidents, especially in a warehouse environment like Alleghany’s. A few employees were also using their IRA as a savings plan, taking money out of their retirement account for emergencies—but potentially robbing their future selves of the ability to retire in the process.
Alleghany wanted to offer a simple, easy way for their employees to build up their emergency savings and have more control of their money.
When Alleghany’s CEO heard about Sunny Day Fund’s Sunshine Platform™, he realized that this could be the perfect solution for his employees.
“He was very impressed with the program,” Kate says. “The goal of Sunny Day Fund completely aligns with our values as a company. We love to see people feel more in control of their money and their future.”
“The goal of Sunny Day Fund completely aligns with our values as a company. We love seeing people feel more in control of their money and their future.”
The Solution: Employer-Rewarded, Paycheck-Deducted Emergency Savings
With Sunny Day Fund, employees who choose to can have their emergency savings deducted directly from their paycheck during payroll, making it much easier to save for an emergency.
“I typically tell people that this is a chance to pay themselves back,” Kate explains. “They can put the money aside before it’s even in their checking account and let it grow until they need it.”
Participating employees get access to a brand new FDIC-insured savings account with base interest and additional employer rewards.
“Sunny Day Fund makes saving easier,” Kate says. “It’s hard to save money. A program that allows you to set aside funds directly from your pay is helpful.”
On the company side, getting set up was a smooth process, Kate adds. Integrating Sunny Day Fund with Alleghany’s payroll tool was easy. When they switched payroll systems earlier this year, it was simple and painless to migrate Sunny Day Fund with it.
Sunny Day Fund is so easy to use, it takes the Alleghany team less time to administer than the company’s retirement fund.
“It’s very manageable,” she says. “Once an employee opens up their Sunny Day Fund account, all I have to do is key in a code and add their contribution amount to our payroll system. It is less time consuming to administer than our IRA.”
In addition to the funds that employees contribute, Alleghany Warehousing also provides 7% rewards on Sunny Day Fund balances every quarter, effectively equipping its employees with a 31%+ APY up to a maximum of $280/year.
“We wanted to have an amount that was significantly more than you would receive from interest with your regular bank savings account, without becoming a big ticket expense item for the company,” Kate says. “We wanted it to be a support for the employees.”
“Sunny Day Fund makes saving easier. It’s hard to save money. And when you put money aside and know it’s there, that’s helpful.”
The Results: 43% company-wide participation and $59 average contribution per two-week pay cycle
Today, Sunny Day Fund helps 43% of Alleghany’s eligible workforce build up their emergency savings, with a $59 average contribution per two-week pay cycle.
In addition to administering the fund, Kate also participates as a saver. She’s planning on withdrawing from her fund for the first time soon to cover some upcoming family expenses.
“I’m just like everybody else, with our family budget money comes in the door and money goes out the door,” she says. “We are always trying to save money as a family. This program is an opportunity to put money aside in an accessible manner that doesn’t have the temptation of being in our regular account.”
For Kate, Sunny Day Fund and benefits like it help show their employees that Alleghany values their time and contributions to the company.
Attract and retain a more financially resilient workforce with employer-rewarded emergency savings from Sunny Day Fund®.