Between inflation and economic instability, Americans have used up most of the money in their savings accounts.
A Bankrate survey conducted earlier this year found that more than half of all Americans are currently living paycheck to paycheck, and that most adults (57%) cannot afford a $1,000 emergency expense. found.
Meanwhile, experts say cash reserves are key and can prevent workers from relying on high-interest credit cards or making difficult withdrawals from retirement accounts.
More and more employers are stepping in to address the savings crisis.
already, delta airlinesStarbucks, Best Buy, Levi’s, etc. emergency savings benefitMany of the new retirement laws in Secure 2.0, a law enacted in December, focus on improving retirement security by making it easier for workers to build and access emergency cash. This is due to the results.
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Credit card interest rates are essentially in the realm of “usury”
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Money market funds and high-yield savings accounts
“This bill has definitely started more discussion,” said Katie Taylor, vice president of planning and engagement at Fidelity Investments.
“The ability for employers to help employees feel like they have a solution in place to manage their finances overall is critical,” Taylor said.
Delta Air Lines gives employees up to $1,000
A Delta Airlines plane arrives at Hartsfield-Jackson Atlanta International Airport.
Jeff Greenberg Universal Images Group | Getty Images
Under Delta emergency savings programis available to all employees at the Director level and below, and employees will receive $750 deposited directly into their Fidelity account after completing one financial coaching session.
The airline will then transfer up to $250 of the employee’s payroll deduction contribution to that account, for a total of $1,000.
“Financial literacy is the civil rights issue of this generation,” said John Hope Bryant, president and CEO of Operation Hope, a nonprofit affiliated with Delta Air Lines and Fidelity Investments.
“It’s as important as the right to vote,” he said. “It is a lifeline to living a dignified life.”
The pandemic has highlighted how valuable these programs are.
Bryant said Delta employees withdrew about $1 billion from their retirement accounts when the economy stalled, leaving them on the hook.
“People were suffering in silence,” he says.
Delta recently expanded this initiative globally to include more than 90,000 employees. The company says more than 33,000 employees have participated so far.
“I didn’t have a strategy in place to save money,” said Loretta Day, a Delta Air Lines flight attendant based in Atlanta. She said, “If you get an email saying there’s a sale on candles, it would be rude not to take advantage of the sale.”
But once Day, 51, completed her financial education classes, it didn’t take long to implement better money habits, she said.
“It made me think about all the things we’re spending on things we already have at home,” Day said.
Since then, Day has paid off her credit card debt and started saving money from her monthly paycheck. She still buys candles from time to time, but she has a bigger purchase in mind: having her own home, she said.
“I gave myself a year,” she said. “I am now confident that when I am ready to retire, I will be in a better position than before.”
“At the end of the day, we believe investing in our people is good for our customers and shareholders,” said Kelly Elliott, vice president of Delta’s Total Rewards Program.
Fidelity’s Taylor added that financially well-off employees are 10 times more likely to be engaged in their work than less well-off employees.
“There are also notable benefits for employers,” she says.
“Emergency savings are the new health insurance.”
ability to reduce Bryant said financial stress and increased productivity will encourage more companies to follow suit.
“Financial literacy coaching and counseling coupled with emergency savings is the new health insurance, and this is what all businesses will be doing over the next 10 years,” he said.
The additional support will encourage workers to “come to work earlier, stay longer and put in more effort,” Bryant added. “In reality, it costs less to treat your employees better. That’s why it’s sustainable.”
If your employer offers you something like free money, take it.
Douglas Bone Perth
President and Founder of Bone Fide Wealth
“If your employer offers you something like free money, take it,” says John, a certified financial planner. true wealth, a New York-based asset management company. “It’s always beneficial.”
“But if it’s not accompanied by the right amount of discipline, it doesn’t matter,” added Bone Perth, a member of the FA Council on CNBC.
Above all, use this as an opportunity to make the most of the financial education on offer, he advised.
