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Why emergency savings accounts are on the rise and how CEOs are taking action.

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By
Devin Miller
November 2, 2021

The days of dog-friendly offices and snack pantries as attractive employee benefits are over. 

In this article, we’ll share results and actionable examples of how CEOs and human resource teams are implementing emergency savings plans as solutions to this labor crisis — and, why emergency savings programs like SecureSave are taking off in general.

With labor availability in short supply, the market generally favoring employees over employers, and inflation on the rise, organizations must think creatively to attract and retain talent. While offering robust benefits like health insurance and retirement plans is attractive to current and future employees, offerings like an emergency savings plan truly make an organization stand out. After all, while traditional benefits can help employees reduce spending, only an emergency savings fund can help them save money.

Increase employee retention

In the paper Building Emergency Savings Through Employer-Sponsored Rainy-Day Savings Accounts, the authors offer an early suggestion of what a “rainy day fund” or emergency savings plan could look like — it revealed that this benefit was not a common offering via employers. In the past year, emergency savings fund programs have emerged via both traditional institutions like Fidelity Investments and new solutions like SecureSave. That means employers who adopt emergency savings plans as a benefit now can leverage status as early adopters to maintain a competitive edge in retention strategies. 

In addition to this specific competitive edge, organizations that adopt solutions like SecureSave (meaning emergency savings programs that offer real-life incentives like an employer match, not just a “game-ified” experience with prizes) are likely to be perceived as genuine rather than virtue-signalling. And, draw attention from more purpose-driven employees like Millennials, who now make up the majority of the American workforce. 

Case Study #1

The CEO of a textile manufacturer in North Carolina knew that his employees were stressed financially, and that this impacted both their work quality and shift availability. He wanted to quickly boost employee savings and help them build a positive financial habit. As a result, he launched SecureSave with a $100 sign-up bonus, and offered a $35 per paycheck match, so long as his employees saved $35 per month. Overall, this put employees on pace to save $1,000 in 6 months. After only a few weeks, the company saw a 73% adoption rate. Additionally, 37% of those who signed up for SecureSave even increased their contributions, stashing away more than the minimum $35 per paycheck required for an employer match. 

Case Study #2

Recently, a 100-employee resort in New Mexico set out to announce their choice of emergency savings account (SecureSave) as part of “National Financial Wellbeing” month. The company hopes to encourage greater employee longevity, and to increase the tenure of current employees. 

Drive adoption through automation and easy deployment

Executives and HR teams are already managing many time-consuming and labor-intensive benefits programs that see lower than expected adoption. With an Emergency Savings program, the key to success is a program that is automated directly through payroll, making it simple for both employers and employees to manage. Successful savings programs, such as SecureSave, have an average adoption of 50%, can be deployed in less than a week, and require very little admin for HR teams. 

Case Study

The CEO of a demand generation company found out about SecureSave after doing some research on Emergency Savings Programs. He reached out to us wanting to deploy in his staff all-hands meeting the following week. His SecureSave program was live within 24 hours, we deployed to his staff in 2 days, and within 7 days they had 49% adoption after just one email invitation.

Optimize talent attraction

For privately held small to midsize companies, the struggle to recruit and retain talent is often more stressful and difficult to navigate. This is true especially now in a market that favors the employee. At these types of companies, just a few open roles can have a major impact on operations — but a big risk doesn’t necessarily warrant a big solution. Something simple, like an emergency savings account, can do the trick.

While a suite of benefits is clearly an attractive way to package an offer of employment, few companies stand out among the standard offerings of company holidays and happy hours. Emergency savings plans scale easily and are inexpensive to maintain in the long-term, offering retention benefits once a candidate is secured. However, these same plans can also be offered as a one-time employer match, acting as a signing bonus or being offered in addition to one. 

Boost employee morale

In a world where team-building is primarily remote, and where traditional in-person gatherings raise risks for both employees and organizations, companies must think creatively in order to boost morale. From virtual happy hours to wage increases, the possibilities to increase employee happiness are endless. 

According to recent studies (like this 2018 research from Princeton University), financial wellbeing is key to happiness — not just money itself. By offering an emergency savings account as a workplace benefit, employers can instill healthy financial habits in employees, and all but solidify happiness at work.  

Case Study #1

The CEO of a 120-person textile manufacturer in the US consulted SecureSave after learning about the solution in the Wall Street Journal. To help employees reach a goal of $1,500 in savings each as soon as possible, the CEO made the executive decision to offer a company match, in addition to front-loading the offer with $200 per employee. Each employee was required to save $25 per paycheck to receive the match, and maintain a specific balance. The CEO also plans to add a holiday bonus into each participant's account as a way to boost adoption, and will announce the bonus during the company’s holiday party this year.

Case Study #2

This summer, the CEO of a medical practice in North Carolina deployed SecureSave to his employees in order to boost morale and show support. For frontline workers in the medical field, the COVID-19 pandemic has put undue stress on already taxing jobs. During this time, 43% of the medical practice’s staff adopted SecureSave, and are now saving an average of $55 per month in their emergency savings funds.

Why choose SecureSave 

With 73% of Americans citing finances as the top stressor in their life, and more than half agreeing that saving for emergencies is a top financial priority, an emergency savings program like SecureSave can be a practical and meaningful tool for employers to offer new and current employees.

SecureSave is not only helping to deliver great results for businesses, but also creating a habit of saving that employees will carry with them for a lifetime. This benefit can impact a large percent of employees in a profound way, while also giving employers a fast solution in this competitive job market, and allow any company to leave a positive legacy. 

With program launch in as little as one week, and with a nearly 50% adoption (within days or weeks of deployment), SecureSave is an easy to use and simple solution. To learn more about our Payroll Connect feature and highly-automatic administration, reach out to us today.

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Devin Miller

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