SoFi

There’s a tug of war going on in corporate America. After months of reduced commuting, time with family, and casual dressing, most employees who have been working outside of the office don’t want to go back to the office every day of the week.

Most employers, however, are looking forward to a return to normal, which means almost all of their staff are back at their desks.

According to the MetLife U.S. Employee Benefit Trend Survey 2021 using multiple data sets, 90% of employers who have changed working arrangements say they expect to return to pre-pandemic working arrangements once they can. But 76% of the employees surveyed are interested in alternative work arrangements like remote work and more flexible schedules.

Probably for most workforces there will be a compromise. At this stage in the pandemic recovery, it’s clear that at least some version of a remote workforce will continue to exist among non-essential workers, with many employees preferring a hybrid situation. More than half (55%) of the employees surveyed said they’d like to be remote at least three days a week, according to the latest US Remote Work Survey from PwC, which surveyed 1,200 US office workers between November 24 and December 5, 2020. (Essential workers were excluded.)

How can employers best prepare for this new reality?

During the worst of the pandemic, you may have scrambled to find the technology solutions necessary to help keep your employees connected and productive. Reviewing those solutions and improving them to make sure they’re the most efficient and accessible for remote workers now that the worst of the emergency is behind us is the first line of defense.

Next, keep in mind, most workers understood their employers were doing the best they could during the pandemic to keep workers safe and keep business going. But now that the emergency feeling is fading, the hard work of managing at least a partial remote workforce is beginning.

The following five action items can help you set realistic expectations while still motivating and rewarding your workforce.

1. Don’t Dictate, Communicate

It can be easy to slip into one-way-only communications with remote workers, especially during an emergency. Various emails are often sent announcing policy, scheduling, or rule changes, seemingly without employee input. That can set the wrong tone among remote workers who may be feeling isolated and younger workers who don’t yet have a sense of the firm’s culture.

But when employees understand how and why a change is being made and when they feel they were part of the decision to change, they are often more likely to embrace it.

That’s why a two-way dialogue with remote workers is essential. Asking for input via spot surveys, open electronic dialogue, virtual town meetings, etc., helps remote workers feel more in control, more engaged, and more accepting when a change is made.

2. Increase Employee Recognition

Remote workers can feel that they’re out of sight, out of mind, especially when it comes to recognition and career development opportunities that were once solely office-based. By the same token, it can be hard for employers to identify and reward employee contributions in a remote setting because the opportunities for managers to acknowledge workers during a hallway chat or group meeting are now limited.

But recognition motivates employees and sets an example for teammates and other workers. Be sure you publicly acknowledge standout performance even if it means a group email or Slack note instead of or in addition to the weekly in-person staff meeting.

Recognizing talented employees often entails offering them professional development opportunities such as skills-building classes and management seminars. Many of these programs may have been put on hold during COVID. But a return to these opportunities needs to take remote workers into account. That may mean moving permanently to a virtual format and/or finding standout programs that work well in a virtual setting.

Encouraging professional development among remote workers may necessitate strong outreach programs. Many employees may be emerging from the pandemic feeling risk averse and hesitant to try something new. Providing a way for employees to express these feelings while still acknowledging workers’ accomplishments can help rebuild employee morale, even virtually.

3. Encourage Innovation

The pandemic has shown us the importance of innovative thinking and strategic problem-solving among all employees.

You’ll likely want to continue to encourage innovation among all workers. This is especially important for remote workers who may feel disconnected from both the problems and solutions facing the company as a whole.

Some ways to foster engagement: Release a public agenda of problems and challenges the firm is facing. Ask, via virtual town hall or open letter, for employees to submit ideas and send a followup email. Conduct smaller virtual brainstorming sessions to encourage teams to come up with solutions together. Encourage department heads and team managers to do the same with their staff regarding the specific challenges their areas are facing. Consider incorporating management training for remote working to help leaders navigate this new reality.

Perhaps most important, listen to the feedback and ideas carefully. When an employee-led solution is implemented, be sure to acknowledge that fact publicly to encourage more innovation.

4. Make Remote Possible

Even if your organization is aiming for all staffers to return to the office, the reality is some type of hybrid system may be in place for some time. That may mean rethinking daily and weekly routines, some of which you may have still followed during COVID. They may simply not work any longer for a hybrid remote/in-person staff.

The 9 a.m. team meeting, for instance, may have to morph to accommodate both in-person and remote workers. The solution may be as simple as making it an afternoon meeting. Or only meeting when an agenda item arises, instead of a set time every week.

Focusing on output rather than process can also help accommodate workers in a remote or hybrid situation. Managers who worry less about how employees are getting their work done each day and focus more on what they expect of each team member on an extended timeline may find it easier to increase productivity among remote and hybrid staffers who are still adapting to a more flexible schedule.

5. Help Relocated and Local Employees with Homebuying

Many workers are considering new home purchases as a result of the COVID-19 pandemic and the new remote work reality. Some may want to relocate to less crowded rural areas now that they’re able to telecommute. Others, returning to work after COVID, may want to move closer to the office to cut down on commute times.

Whatever the motivation, employers who offer Employer Assisted Housing (EAH) may see an increase in loyalty and productivity among workers who participate. EAH can take many forms, but the benefit most often includes:

•  Homebuying education. Often conducted by a commissioned real estate or lending professional, this teaches employees about shopping for a home, mortgage qualification, taxes, insurance, and other basics.

•  Mortgage and credit counseling. Employees meet one-on-one with a CFP or other certified professional to learn how to improve their credit scores, qualify for a mortgage, avoid foreclosure, and other important mortgage-ready lessons.

•  Financial assistance. Many employers provide loans or grants to help employees with mortgage, closing, and/or moving costs.

•  Group mortgage origination. This entails the employer negotiating with mortgage providers to offer better rates and lower costs for their employees.

The Takeaway

The COVID-19 pandemic may have forced many companies to turn to remote work. But now we may be in a position to combine the best of both the worlds of in-office and at-home work. It’s important to do that in a way that takes into account the preferences of your workforce and to get their input and buy-in as you develop a plan that works for your company. For more information on how to more easily incorporate a remote workforce, visit SoFi at Work.

Photo credit: iStock/ake1150sb

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For information on licenses, see NMLS Consumer Access (www.nmlsconsumeraccess.org ). The Student Debt Navigator Tool and 529 Savings and Selection Tool are provided by SoFi Wealth LLC, an SEC-registered investment adviser. For additional product-specific legal and licensing information, see SoFi.com/legal. Equal housing lender.
SOBD052112

What is resiliency? It’s the ability to adapt and even thrive in times of uncertainty.

Resilient employees embrace new challenges, solve problems and build teams, all while keeping a solid goal in mind, according to MetLIfe’s 18th Annual U.S. Employee Benefits Trend Study 2020 entitled Mental Health: A Path to a Resilient Workforce and Business Recovery, which includes feedback from 1,000 workplace decision-makers and 2,000 full-time employees over the age of 21.

During the pandemic, employers may have learned a new appreciation for resiliency. That’s because they collectively witnessed hundreds of thousands of workers continue to meet and exceed expectations in all types of jobs, across all levels, during a devastating time. But even though we seem to be approaching the end of the pandemic, the stresses workers experienced are likely to have a long-lasting impact on our workforce and the way we will work in the future.

It’s a reminder to HR professionals just how prized the quality of resiliency should be and how important it is to build and nurture workplace resilience. The bottom line: More resilient employees may have a positive impact on your business, especially for firms that are recovering from COVID-19’s negative economic impacts.

Here’s what HR professionals can do to help employees become more resilient.

Acknowledge Pandemic Stress

COVID-19 added dramatic new stressors for employees. These included illness and the fear of illness, isolation, economic uncertainty, working remotely, and homeschooling children. As employees shift back to the workplace or make the decision to stay remote, many may be suffering from COVID-related and post-COVID stress. Forty-one percent of workers say they feel stressed, burnt out, or depressed at work regularly, according to the MetLife survey. And as we all continue to adjust to a post-COVID world and workplace, there are likely to be more challenges and stresses on an ongoing basis.

Acknowledging this stress and the signs of burnout and depression that may also be evident in your workforce is the first step toward building a resilient culture for the future. An open culture in which employees feel comfortable voicing their challenges and asking for help with no fear of stigma builds trust and loyalty among your workforce. Taking these initial steps sets the stage for fostering well-being and accelerating resilience.

Lay the Foundations for Resilience in Your Workforce

Do you have the infrastructure in place to support your workers and help them achieve resiliency? To answer that question, you may need to determine if your mental health benefits are comprehensive, accessible, and inclusive. A strong connection between mental health and resiliency is supported by the findings that 80% of employees who rate their mental health as good are productive and 79% are engaged with their work. By way of contrast, those figures are 60% and 47%, respectively, for employees who do not rate their mental health as good, according to the MetLife survey.

In the wake of the pandemic you may find that you need to initiate additional educational efforts surrounding mental health awareness in general and what your company offers specifically. It also means creating a culture that eliminates any stigma or barriers to using those benefits, including addressing concerns about privacy, trust, and cost.

Along those lines, make sure your mental health benefits are easy to use. If an employee has to go through hoops to access help for stress, substance use disorders, and other issues, they may become discouraged and miss the support they need.

Review Telehealth Behavioral Services

The dramatic increase in use of telehealth for mental health services, including counseling, psychotherapy, and treatment for addiction during the pandemic, has helped make these services more accessible. It may also have increased employees’ willingness to take advantage of mental health benefits.

From January 2019 to February of 2021,the use of telehealth for behavioral health services rose 6,500%, as more employers offered behavioral telehealth services and more people sought a virtual alternative to in-person counseling, according to data analyzed by LexisNexis Risk Solution Health Care for the 2021 COVID-19 Mental Health Impact Report.

You’ll want to review your telehealth services to make sure behavioral health is included and accessible to your employees. With reentry from the pandemic and the stress that can cause, it’s likely that demand for these services, both in-person and virtual, will continue. Make sure employees know about telehealth services and their increasing popularity. Assure them that telehealth offers the same privacy and a similar quality of care but may be more convenient and/or accessible than in-person care.

Review Your Company’s Employee Assistance Program

Another step: Take a close look at your employee assistance program (EAP).These employer-sponsored programs help workers manage a range of issues for themselves or other members of their household including substance abuse and other mental health issues. Sixty-three percent of employees with access to EAPs are likely to be resilient compared to 46% of employees who do not have access to EAPs, according to the MetLife survey.

But, as the report points out, EAPs are only effective if employees use them. You may want to consider making more efforts to increase awareness of your EAP, including guidance on when and how employees should use it. Ask yourself whether, in the wake of the pandemic, there are any additional services you may need to add to your EAP.

Integrate Financial Wellness into Your Resiliency Strategy

Feeling financially stable may add to resiliency. According to the MetLife survey, employees with good financial health are twice as likely to report having good mental health.

But financial stress can be a huge driver of mental health stress, and the pandemic has added to the strain. Before COVID-19, 52% of employees reported feeling major financial stress. Since COVID-19, that number has jumped to 81%.

Boosting and promoting your financial wellness programs, particularly financial planning, debt counseling services, and emergency savings programs can help bring financial stability to employees and build their resiliency for the next period of uncertainty.

The Takeaway

While 2020 was one of the most turbulent examples, it’s important to remember that your employees wrestle with stressful situations every day. Providing holistic support and benefits that can help employees cope with uncertainty can help you build a resilient, productive and stable workforce. A resilient workforce can, in turn, support your business through times of adversity. For more information on the benefits and programs that can help you build a resilient workforce, see SoFi at Work.

Emergency Vaults are part of a checking and savings account with SoFi.
SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi Money® is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member
FINRA / SIPC . SoFi Securities LLC is an affiliate of SoFi Bank, N.A. SoFi Money Debit Card issued by The Bancorp Bank.
SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For information on licenses, see NMLS Consumer Access (www.nmlsconsumeraccess.org ). The Student Debt Navigator Tool and 529 Savings and Selection Tool are provided by SoFi Wealth LLC, an SEC-registered investment adviser. For additional product-specific legal and licensing information, see SoFi.com/legal. Equal housing lender.
SoFi members with direct deposit can earn up to 4.20% annual percentage yield (APY) interest on Savings account balances (including Vaults) and up to 1.20% APY on Checking account balances. There is no minimum direct deposit amount required to qualify for these rates. Members without direct deposit will earn 1.20% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. These rates are current as of 4/25/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.
SOBD062112

Few events that your employees experience are as life-changing as becoming parents. That’s why new parents often begin to look at their employee benefits in a new light. Now, after all, they’re relying on their employers for new kinds of important support as well as continued financial well-being.

As an HR professional, you may also want to take a fresh look at your company’s Total Rewards strategy to make sure you don’t silo parent-oriented benefits. This could happen if you single out important offerings such as parental leave and college savings programs, but don’t always integrate parenthood into the overall financial well-being program.

Why Parental Benefits Are Now More Key Than Ever

The importance of parental benefits may be even more pronounced than it used to be as we emerge from the pandemic and employers begin to reestablish in-person workforces.

When 1,508 American working moms were surveyed between March 8 and April 20, 2021, only 31% said they were planning to return to the workforce in the next 12 months. The survey, conducted by TopResume , looked at working women who identified as primary caregivers to children under the age of 18.

The more flexibility and support employers provide, the more willing parents may be to return to work. What’s more, employers who understand what employees at any stage of parenting need to maintain and elevate their financial well-being stand to gain enormous loyalty from their staff.

Today’s diverse workforces require customized programs that can help them achieve their individual and family financial wellness goals. This applies to parents of all ages of children as well as to parents of newborns.
Here’s how you can make sure your Total Rewards strategy is doing the best job possible to attract, retain, and support your parent employees.

Evaluate Your Existing Parental Benefits

Are your parent-oriented benefits offering the best help you can give to the widest variety of your parent employees?

Some of the most common benefits include parental leaves, paid time off, and college savings programs. Let’s look closely at each to help determine if your offerings are up-to-date and effective.

Paid Parental Leave

The Federal Family and Medical Leave Act allows eligible employees at large employers to take up to 12 weeks off after the birth or adoption of a child. But the Act does not require that an employee be paid for this time. And state laws on family medical leave can vary significantly.

In December 2020, the federal government began offering 12 weeks of paid parental leave to many civilian government employees who have been on the job for at least a year and then become parents through birth, adoption, or foster care.

Although this act applies only to government employees, it sets a strong example for private and nonprofit organizations. Ask yourself whether your firm is keeping up with the most recent paid-leave policies? Are your leave policies inclusive–available to fathers and non-birth mothers\\, adoptive parents, foster parents, and parents who use surrogates?

Flexible Return to Work Schedules

Just in case it wasn’t already obvious, the pandemic has demonstrated how important flexible work hours are for parents. With any luck, in the future your employees will no longer be trying to figure out how to cope without childcare while trying to work at home and homeschool the kids. But many of the pandemic parenting stresses remain for many workers.

A flexible return-to-work policy for new parents can help. Some employers, such as PWC, for example, are finding that a gradual return can help with the transition. The firm allows parent employees to work a 60% reduced schedule at full pay for up to four weeks as they return to work. This policy went into effect in July 2018, well before the pandemic, but it may prove particularly attractive as the firm transitions employees back to the office.

For parents of slightly older kids, Mastercard has taken a different tack by creating a virtual kids Club that offers educational games to keep children between the ages of five and 12 occupied while their parents are working at home.

Other companies have had success with increased remote schedules for reentering parents and more flexible PTO benefits that accommodate children’s illnesses and childcare gaps.

Whatever ways you decide to support the transition from parental leave to a return to work, be sure they’re clearly communicated to your workforce. Ideally, you want to have a sit down with a new parent employee before the baby arrives to review all relevant benefits, including what’s expected during a return to work.

Inclusive Parental Benefits

Be sure your leaves, time-off, and return-to-work policies apply to all types of families. Parental benefits are a wonderful opportunity for building your inclusive benefits strategy. Same-sex couples with surrogates, adoptive parents, and foster parents need the same parental leave and flexible return-to-work policies as traditional birth mothers. And any type of new parent may need spousal or partner time off for bonding and caretaking. If your health plan covers fertility treatments, you may want to ensure that same-sex couples and other non-traditional families are covered by those as well.

Early College Savings Opportunities

The idea of saving for college starting as soon as a child is born is nothing new. But is your company doing everything it can to make that possible? Automatic payroll contribution to a 529 savings plan can be one of the most effective ways for all parents to save for their children’s education.

In addition, assistance with determining what 529 savings plan is best for your employees may also help. Employer-provided guidance can help parents navigate state tax laws, fees, maximums, minimums, and investment options among the different 529 Savings Plans available.

Customize Financial Well-Being Benefits to Help Parents

At this juncture, new parents likely need access to any financial planning and counseling services your financial wellness benefits offer to help navigate the money challenges parenting brings. In addition, overall wellness benefits can help reduce stress and increase productivity. Some examples:

•  Access to legal services to help write wills, designate guardians, and change beneficiaries

•  Opportunities to sign up for any supplemental life insurance or disability income insurance your organization offers and guidance on why protection can be more of a priority for parents

•  House hunting and mortgage services. An expansion of the family often requires a move to a larger space, making home buying benefits more relevant than ever.

•  Help building an emergency fund while keeping track of other financial priorities.

•  Financial planning services can help parents reset priorities and budgeting in light of a new addition to the family. Parents may also benefit from a retirement planning deep dive. Although planning for long-term goals may seem impossible in the midst of such a huge life event, it’s important for parent employees to remember that planning well for their own futures helps ensure the financial future of their children as well. No parents want to have to rely on their children financially in old age. Making sure that doesn’t happen begins now, and employers can help.

•  Student loan pay down programs can help parents handle their obligations from the past while still being able to plan for the future.

•  Renew new parents’ engagement in overall wellness benefits such as weight loss, exercise, and stress reduction programs. If you don’t already, consider offering such programs specifically targeted to parents with children of all ages. It’s likely that any parent reentering the workforce has residual COVID-19 related stress to deal with, not just new parents.

The Takeaway

Becoming a parent is a life-changing occurrence for anyone. But employers can use this happy event to solidify financial well-being, loyalty, and productivity among their workers who are parents.

Photo credit: iStock/Tempura

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi Money® is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member
FINRA / SIPC . SoFi Securities LLC is an affiliate of SoFi Bank, N.A. SoFi Money Debit Card issued by The Bancorp Bank.
SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time. SoFi members with direct deposit can earn up to 4.20% annual percentage yield (APY) interest on Savings account balances (including Vaults) and up to 1.20% APY on Checking account balances. There is no minimum direct deposit amount required to qualify for these rates. Members without direct deposit will earn 1.20% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. These rates are current as of 4/25/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.Emergency Vaults are part of SoFi Checking and Savings.
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For information on licenses, see NMLS Consumer Access (www.nmlsconsumeraccess.org ). The Student Debt Navigator Tool and 529 Savings and Selection Tool are provided by SoFi Wealth LLC, an SEC-registered investment adviser. For additional product-specific legal and licensing information, see SoFi.com/legal. Equal housing lender.

SoFi Student Loan Refinance
If you are looking to refinance federal student loans, please be aware that the White House has announced up to $20,000 of student loan forgiveness for Pell Grant recipients and $10,000 for qualifying borrowers whose student loans are federally held. Additionally, the federal student loan payment pause and interest holiday has been extended beyond December 31, 2022. Please carefully consider these changes before refinancing federally held loans with SoFi, since the amount or portion of your federal student debt that you refinance will no longer qualify for the federal loan payment suspension, interest waiver, or any other current or future benefits applicable to federal loans. If you qualify for federal student loan forgiveness and still wish to refinance, leave unrefinanced the amount you expect to be forgiven to receive your federal benefit.

Providing an Emergency Savings Account (ESA) is fast becoming a way to help provide a foundation for financial well-being. With 37% of respondents reporting they would be unable to fully cover a $400 unexpected expense in 2019, according to a Federal Reserve report providing an emergency savings program that’s easy and accessible helps tell your workforce that you know what they’re going through and you’re there to help.

That said, HR professionals who are already managing an ESA, in the process of introducing one, or considering a rollout all face a basic yet important question: How much should their employees stash away in these accounts?

Clearly, employees themselves have the final say. But an efficient plan structure with appropriate minimums, maximums, and matches; solid guidance; and accessible educational efforts can go a long way toward spurring engagement and helping workers make the most of this important benefit. Let’s take a closer look.

Finding the ESA Sweet Spot

When offering guidance on how much to save for emergencies, employers may want to aim for the “sweet spot.” That’s somewhere between essential short-term savings and a continued focus on long-term financial goals, especially during times of economic uncertainty.

Finding this can be tricky. Take ESAs and 401(k) savings, which often have a direct effect on each other and present HR professionals with a bit of a conundrum.

On the one hand, ESA savings can improve overall financial health and help employees avoid withdrawing funds from their 401(k) savings early, preventing any potential tax penalties and lost income in those accounts.

Having the cash stashed away to weather financial upheavals can also add to employees’ long-term financial well-being. People with ESAs are 2.5 times more likely to be confident in their long-term financial goals, according to an AARP Public Policy Institute report .

But by the same token, too much emphasis on short-term savings may dampen employees’ willingness to save in traditional retirement accounts. This is especially true in light of the pandemic, when many employees may have taken some short-term financial hits, leaving them with fewer resources to save for the long-term. In fact, one in three Americans have decreased or stopped their contributions to retirement savings due to COVID-19, according to a 2020 survey of 1,000 U.S. adults conducted by FinanceBuzz .

Employers can help workers balance this short-term/long-term financial tension by helping them understand their individual savings needs, goals, and risks of encountering unexpected expenses.

Rethinking Conventional Wisdom about Emergency Savings

One way to do that may be to look beyond the traditional advice concerning emergency savings. Financial institutions, such as Vanguard and Fidelity, often recommend that clients save three to six months’ worth of expenses (or more) in a cash or cash equivalent account in case of a job loss, medical issues, or other income disruptions.

But some experts believe that lower-, moderate-, and even some high-income workers may be discouraged by that goal and give up on emergency savings altogether. Setting more achievable dollar figures such as $500 or $1,000 may be more realistic and more motivating than the traditional advice. And this approach can still help maintain the employee’s financial well-being. The median medical expense reported by respondents in the Federal Reserve survey was between $1,000 and $1,999.

To get employees started, encouraging them to save realistic amounts for common unexpected expenses may offer them a more accessible goal than the three-to-six months’ worth of expenses formula.

Keep in mind, the “goal” for emergency savings is fluid. The idea is for your employees to build a cushion, use it as needed, and then replace those funds and build the account some more. That’s why a hard-and-fast number doesn’t always work. Focusing on regular contributions that keep the fund functional can be more important.

Calculating Minimums, Maximums, and Matches

Benefit design can go a long way toward motivating employees to engage in emergency savings. Flexibility is key.

Minimums and Maximums. When you’re setting up a savings benefit of this kind, there are usually minimums and maximums involved. In many cases, employers work with an outside bank/vendor that may have its own restrictions. You may also want to impose some structure to run the program efficiently and engage your employees.

Keep in mind, minimums need to be low enough to engage, not overwhelm, workers. Amounts as low as $25 to $50 a week are not uncommon. Once the momentum starts and employees see balances increasing, they may want to increase the amount they’re depositing. Make sure this process is easy for them to do. And remember that flexibility is key. If an employee must miss a month, consider not imposing any penalties. Otherwise, you may discourage an employee who happens to be temporarily strapped that month but who does want to save.

Maximums can be an important tool in ensuring that employees aren’t overly focusing on short-term savings or disregarding their 401(k) and other long-term savings goals. You’ll want to use the tools and information outlined above to set a thoughtful maximum that will help employees successfully cover unexpected expenses and, at the same time increase their confidence for long-term goals.

When determining maximum amounts, you’ll also want to consider whether excess contributions can spill over into other types of saving programs, such as after-tax retirement contributions. This requires more administration but can be a useful tool to help employees balance short and long-term savings goals.

Auto-Enrollment. HR professionals have seen how automatic enrollment in 401(k) plans has significantly increased participation. The same may hold true for auto-enrollment payroll deduction ESAs, in which a small portion of each employee’s paychecks is automatically deposited into an employer-sponsored account. Recent Consumer Financial Protection Bureau guidance easing government restrictions has made it easier for employers to implement automatic enrollment for emergency savings.

Using the information outlined above to determine the percentage deducted for each level of your workforce can help make these automatic payments accessible and sustainable.

Recommended: Is Automatic Enrollment Consistent with a Life Cycle Model?

Employer Match. Kicking in an initial amount to help employees get their emergency fund started or offering a match tied to employee contributions can provide a strong incentive for employees to start saving.

One company might match employee contributions up to $40 a month. Other employers may provide a contribution once the employee has hit a certain savings threshold like, say, $250. For a relatively low cost, your company can provide a match that can help employees hit their emergency savings targets faster, improve their engagement, and enhance their overall financial wellness.

The Takeaway

SoFi at Work can help you and your team implement a successful emergency savings program, including guidance on how much your employees should save for unexpected expenses.

Photo credit: iStock/katleho Seisa

Emergency Vaults are part of SoFi Checking and Savings.
SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi Money® is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member
FINRA / SIPC . SoFi Securities LLC is an affiliate of SoFi Bank, N.A. SoFi Money Debit Card issued by The Bancorp Bank.
SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
SoFi members with direct deposit can earn up to 4.20% annual percentage yield (APY) interest on Savings account balances (including Vaults) and up to 1.20% APY on Checking account balances. There is no minimum direct deposit amount required to qualify for these rates. Members without direct deposit will earn 1.20% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. These rates are current as of 4/25/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For information on licenses, see NMLS Consumer Access (www.nmlsconsumeraccess.org ). The Student Debt Navigator Tool and 529 Savings and Selection Tool are provided by SoFi Wealth LLC, an SEC-registered investment adviser. For additional product-specific legal and licensing information, see SoFi.com/legal. Equal housing lender.
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When employees feel financially secure, they can be more engaged, focused, productive, and loyal workers.

But simply offering a variety of financial benefits may not be enough to let all members of your workforce actually achieve financial wellness. And that’s especially true in the wake of the pandemic.

So what are you doing right? And what can you improve?

Measuring financial well-being can help you answer those important questions.

Why Measure Financial Wellness and Why Now?

“A person’s financial well-being comes from their sense of financial security and freedom of choice – both in the present and when considering the future,” according to the Consumer Financial Protection Bureau .

A SoFi at Work analysis of the Bureau’s 2017 National Financial Well-Being survey of more than 14,400 respondents shows that over 50% of American workers are financially vulnerable, with 40.9% financially precarious and 11.4% financially distressed.

More surprising? The employees in these categories are not always the ones you might expect. Sixty percent of those surveyed who felt financially vulnerable and were employed were making more than $75,000 a year. And 50% of the same group had earned at least a bachelor’s degree.

More recently, the pandemic has impacted some workers’ ability to save for retirement, according to results from the Employee Benefit Research Institute’s 2021 Retirement Confidence Survey of 3,017 American adults. Three in ten workers said reduced hours, lower-income, or job changes due to COVID-19 have affected their retirement savings.

As an HR professional, you may want to take the measure of financial well-being in your workforce. Doing so can let you see firsthand the financial struggles your employees may be going through, how those struggles connect to business outcomes, and how your Total Rewards strategy can help.

How to Better Understand Your Unique Workforce

Measuring financial well-being will allow you to determine what segments of your workforce are suffering the most. It can also help you figure out what you can provide to help all your employees move forward. For many employers, that’s a two-part process.

1. Wage Assessment

Many employers start this process by assessing wages. No doubt you’ve compared your wage and salary decisions against competitors’ offerings, the local labor market, and industry averages. Indeed, you may be paying above the industry standard. But it’s important to remember that even above-standard wages don’t ensure financial wellness. Your workers may still be struggling.

With that in mind, you may want to compare your company’s wages against what constitutes a local living wage in the areas where your employees work. MIT’s Living Wage Calculator may be able to assist you with this. This tool helps determine how much money a person in a specific area needs to earn to cover basic expenses and how much that person has leftover for disposable income, including saving for the future. This may be a more realistic gauge for all levels of your workforce when assessing wages and determining financial well-being.

2. Self-Assessment Survey

The next step is to gather input from your employees. If you haven’t already, you’ll want to design an online financial wellness assessment survey and encourage all employees to participate.

An effective self-assessment survey analyzes four pillars of financial security.

Spending: With these questions you’ll find out how many employees are spending beyond their incomes either because they have expenses that are higher than their income or because of bad spending habits. By asking how long employees think their money would last if they suddenly lost their income, you’ll also collect data on how many of your employees are prepared for an emergency.

Saving: Retirement savings will likely dominate this section. How many employees are participating in your organization’s 401(k) or other retirement savings programs? How much of their annual income are they saving? Are they taking advantage of any match? Do they have an idea of how much they’ll need to save for retirement?

You’ll also want to find out how much your employees are saving for other goals such as emergency savings funds, college tuition, or a home down payment. This may be especially important if your benefits package includes other types of savings programs in addition to retirement.

Debt/Borrowing: Here’s where you want employees to ‘fess up to credit card debt, mortgages, student debt (their own or their children’s), and personal loans. Assessing debt is a vital element for financial wellness. Some leverage, such as a mortgage or tuition loans, can be useful financial wellness tools. But credit card and other debt can be among the biggest obstacles to financial well-being.

Planning: Questions concerning employees’ purchase of life insurance and disability income insurance can paint a picture of how well-protected they are – an important element of financial wellness. This is a good place to ask if employees have set financial goals for the future and if they’ve worked with a financial counselor to do so. You’ll get a sense of what percentage of your employees are looking forward while still taking care of short-term needs/desires. Importantly, this will also let you know how much of your workforce is engaging with the financial planning tools you may be offering.

Depending on your workforce and your goals for the assessment, you may also want to include more subjective elements in your research, such as employee diaries or interviews. This can add human stories to the data collected and help inform new benefits going forward.

Sofi at Work offers a comprehensive benefits assessment tool that can be customized to your workforce.

Measuring Financial Wellness Empowers Employees

When employees take a smart, well-written, and well-designed assessment survey, they’re not just providing information to their bosses, they’re also thinking through their own financial wellness strategy.

Incorporating an interactive tool that gives immediate feedback can help employees identify their status as they emerge from the pandemic and balance their short- and long-term financial goals.

Providing a one-on-one meeting with a financial planner or other expert for each employee to have after completing the survey encourages your workers to take action with their newfound knowledge and further enhance their overall financial wellness. (It can also prompt more willingness to take the assessment among employees.)

Measuring Provides a Compass for Your Financial Wellness Benefits

You’ll also want to analyze your own data on the benefits you’re currently providing to determine how well they’re contributing to employee financial wellness. A comprehensive look at who is using what benefits–including everything from health insurance to 401(k)s to paid parental leave and student loan assistance–and what employees are paying for or contributing to those benefits, can unlock details about access and participation among all levels of your workforce.

A benefit analysis combined with a wage assessment and employee financial wellness survey helps provide a deeper understanding of gaps in your Total Benefits strategy, areas where employee engagement and education are needed, and what new tools and programs might enhance financial well-being among your workers.

The Takeaway

Measuring your employees’ financial well-being now, can lead to the design and implementation of benefits that will enhance financial wellness for all of your employees in the future.

Photo credit: iStock/SDI Productions

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For information on licenses, see NMLS Consumer Access (www.nmlsconsumeraccess.org ). The Student Debt Navigator Tool and 529 Savings and Selection Tool are provided by SoFi Wealth LLC, an SEC-registered investment adviser. For additional product-specific legal and licensing information, see SoFi.com/legal. Equal housing lender.
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