Companies Can Help Employees With Financial Emergencies [infographic] – Friday Distraction
I’ve spent the majority of my career working in industries with large hourly workforces. And much of that hourly workforce was paid minimum wage – or just above it. As a result, when employees had financial emergencies, it impacted their work. Which means it impacted the workplace.
You might have already seen this statistic, but nearly half of Americans do not have enough cash on hand to cover a $400 emergency expense, according to the Federal Reserve’s annual report on the economic well-being of U.S. households. Keep in mind that for some people $400 might not sound like a lot of money, but for others it’s HUGE. A child or parent gets sick and needs to visit the emergency room. Or a car breaks down. Or a refrigerator stops working.
The reason I’m bringing this up is because, as a human resources professional, I’ve been faced with employees trying to get pay advances and loans to cover these kinds of financial emergencies. And sadly, the company’s response has always been “no”. And I get it, the company doesn’t want to get into the loan business. But that doesn’t mean they’re totally heartless about the workplace challenges that money matters create.
Kashable is a company that can help organizations offer their employees with a “Plan B” when emergencies arise. What they do is offer employees low-interest-rate loans that can be paid back through payroll deduction. Employees can only have one loan outstanding at a time, so this doesn’t get to be some out-of-control program for employees (or the payroll department).
There are a couple of things I like about this offering:
- For individuals who need to establish a positive credit history, the Kashable benefit can help. As much as we might not like to admit it, having good credit matters. And the way you get good credit is by taking out loans and paying them back … on time.
- Employees who need emergency funds don’t need to tap into their 401(k) savings programs. I’ve written before about the challenges ahead when it comes to retirement. We need employees to start saving. The Kashable benefit could help employees build their savings to help with financial emergencies.
If you want to learn more, check out this PLH Group case study and consider asking Kashable for a demo. I did, and thought it was worth my time. I honestly didn’t see a downside to this benefit. Organizations can offer employees a valuable Plan B option for when cash flow is an issue. Hopefully, employees won’t need it. But that peace of mind can help employees focus on their work. Just knowing that it’s there. It could be a win for everyone.
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