Sunny Day Fund

Emergency savings benefits program for a modern workforce

Sid Pailla

6 Reasons to make an accessible savings a priority

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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.

Saving for emergencies: Daniel’s story

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We often hear statistics that simplify the story of a person down to a single number. We do that too – we share the statistic from Marketplace-Edison Research that finds that nearly half of Americans would have trouble coming up with $250 for an unexpected expense. But people are more than numbers, and so I wanted to share a story that reflects our learnings from hundreds of conversations we’ve had over the years.

For the sake of anonymity, we’ll refer to this person as Daniel.

Daniel is in his early 30s and has made a good life for himself between his fulltime job and a side gig he’s picked up along the way. Daniel loves the people he works with and admires the company he works for, and believes that corporate leadership has tried to do right by its people. Daniel makes a livable wage, but it’s exactly that – it allows him to live, not necessarily thrive. He’s able to keep up a car, which he needs for his commute; has decent health insurance from the company; and also saves a tiny bit for his retirement, because he hears that’s the right thing to do. Daniel lives outside a small city, and he shares an apartment with a friend. Daniel also has always been devoted to his family.

Daniel was swimming along just fine, and then someone in his family had a medical emergency. He needed to move back to his hometown and financially support his family.

Daniel had tried to save a bit of money when he could, but it wasn’t regular and it was intended for his dreams. And so even after dipping into his limited savings to cover his family’s bills, he needed more money. Daniel could’ve continued adding to his credit card balance, but knew it wasn’t wise, and he was trying to avoid falling into the predatory cycle of payday lending. So, he decided to take some money out of his retirement savings.

But getting his hands on that money was tough. Daniel started bouncing around his company’s HR and Payroll and Benefits departments, trying to figure out how to tap into the precious savings he’s built up – all to help his family get through their crisis. . Three days after the latest hospital bill was due, he found out that he wouldn’t even receive the money for another week, and only after paying a penalty of 10% plus taxes. At the time he needed cash the most, he had to deal with paperwork and penalties.

Easy access to savings is critical in case of emergencies.

Daniel, thankfully, eventually received that money and floated by in the meantime with a bit of help from his friends. But without that help, Daniel and his family were facing not having enough food in the fridge, missing bill payments or even eviction. Potentially, Daniel could’ve been left jobless as a result of his being distracted by these “personal issues.” Daniel’s story is being repeated thousands of times in every community across the country – people are doing the best they can, but one disruption sends them spiraling down a dangerous path.

When I asked Daniel about what he wished would’ve happened, it was clear – he didn’t want to be in that position in the first place. He wanted options that fit his lifestyle and helped him build up some protection from the unexpected. Beyond that, he wanted the opportunity to save for what he wanted out of life – a vacation, a grad school program, a more reliable car. Daniel wasn’t interested in becoming rich, but he did want to be secure enough  to be there for his family in their time of need – and he wanted to do that on his own, with his dignity intact.  

And that’s at the heart of why people want to save – this idea of dignity and self-determination. I have been finding that when we talk with people and hear their stories, people already fundamentally know that savings is important. Sure they need to save because there are just so many things that can go wrong, like the family emergency in Daniel’s case. But this impending sense of doom isn’t the reason that people want to save. People like Daniel want to save because he’s proud of the life he’s built and dreams for his own future.

And it’s for those people – people like Daniel – that we’ve built Sunny Day Fund™. 

Introducing our team!

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It’s my pleasure to introduce you to the Sunny Day Fund™ team and share why we’re so passionate about connecting people to accessible savings.

Over two decades ago, my parents immigrated to the United States with “negative assets” and their only remaining child – me. They did this to give me a great education, the most important gift they could think of, and to build a better life for our family. Of course, as with most immigrant stories, that pursuit was fraught with financial and personal crises. I used my gift of American education to help my family navigate those crises as best I could, and along the way, it became clear how powerful savings could be. Specifically liquid savings – money immediately and easily available.

Those precious lessons were always at the back of my mind as I worked on my prior startups, earned undergrad and grad degrees at the University of Virginia, and consulted with Accenture’s Technology Strategy group. Those savings lessons paired with my professional experience eventually became the genesis of a simple question – if employers can help their employees save for retirement, why can’t they help employees… just save? The impact could be transformative – hundreds of millions of people could overcome emergencies or unexpected expenses, not to mention save towards large planned expenses as well. After nearly five years of deep market research, including surveys and hundreds of stakeholder conversations with employers and employees, I made the pitch to my partner, Sarah – a pitch that remains our refrigerator still today. With her and our families’ blessings, I took the leap to answer that question via Sunny Day Fund™.

No journey should start alone, especially one as big as this. And so Pranitha became the first team member. She brought with her risk and operations management experience at Bank of America, where she oversaw a team handling trade execution and compliance. That financial experience and attention detail proved crucial as she evolved to become our Project Manager. Next, Sunil joined the team as an advisor with his wealth of knowledge on product development. With his counsel, I architected the core platform.

As we developed the platform, it became clear quickly that we needed to have proper quality testing, and that role needed to be internal. Pranitha and I identified Sneha – a coding undergrad – to take on this responsibility along with designing what would become our automated nudge communications. Sneha, who still works part-time with the team, is currently pursuing her Masters in Computer Science at UNC-Charlotte.

At about the same time, it became crucial to establish a standalone engineering team. Josh joined soon thereafter as our lead engineer, bringing over 20 years of experience developing products for both startups and large organizations. His practical knowledge was complemented by the coding prowess and tireless efforts of Samba, who came to us from TechGrit – our technology partner.

With engineering humming, my focus turned to bringing together an advisory board with deeper experience in fintech and HRtech. I turned to the one network I knew best – the University of Virginia – to recruit a stacked team. Tim, Nancy, Greg, and Christian saw the possibilities of what Sunny Day Fund™ could accomplish, and started volunteering their time nearly a year ago to the cause. Shawn joined soon after a serendipitous accelerator application.

More recently, as Sunny Day Fund™ hit the ground with our early customers, I realized that we needed a dedicated leader who would devote their full attention to successfully executing our savings programs with clients and through partnerships. We found that leader in Meredith, a former global HR leader with over a decade of experience, who will soon be joining the team full time.

Along the way, we received resources from our family and friends, time from too many people to name, and unbridled support from networks such as Lighthouse Labs and Startup Boost. Two that remain graciously on hand are Stephen and Shep, unlocking their domain knowledge to the benefit of the team.

And we continue to grow! If you’re reading this and feeling like this is the start of something exciting (because it is) check out our open roles at LinkedIn or Angel.co. I’d love to talk with you, and perhaps one day call you my colleague.

Thanks for reading our first blogpost – follow us on LinkedIn and Twitter so you can see when the next one comes out. Have a Sunny Day!