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Your goal as a small business owner is no doubt to hire a team that serves your company well. You want employees who are reliable, engaged, and efficient at what they do.
But when employees are distracted by financial stress, their productivity has the potential to wane. And when that happens, you and your company lose out.
Unfortunately, recent data from SecureSave shows that 63% of U.S. employees are unable to cover a $500 emergency expense. Because of this, they’re stressed out about their finances. And as a result, U.S. businesses are losing an estimated $4.7 billion per week in worker productivity.
If you want to help your employees better focus on work, then you may need to be prepared to step in and help them build up some savings. Doing so could improve their financial picture as well as that of the company you’ve worked hard to build.
Unplanned expenses can arise at any time. An employee of yours could wake up one morning to find a burst pipe in their home and a host of damage to follow. If that employee needs to come up with a $500 deductible for their homeowners insurance policy to pick up the tab for that mess, and they don’t have $500, they’re apt to be stressed.
Now, imagine the type of workday an employee in that situation is likely to have. Probably, it’s not such an efficient one.
Of course, this sort of scenario can be stressful regardless of how much savings a person has. But now let’s imagine you have an employee in that same boat with savings. They might still show up to the office frazzled, but they may not spend the same amount of time worrying about the situation knowing that they have $500 sitting in an emergency fund to cover that deductible.
That’s why it’s so important to try to help your employees build savings. Not only might having an emergency fund generally improve your employees’ outlook, but it might enable them to better focus when they’re supposed to be helping your company succeed.
Many companies offer employees a 401(k) plan for retirement and even match worker contributions to some degree. The beauty there is that 401(k)s are funded right out of payroll deductions so workers stay on track with their long-term savings. You can do the same thing for emergency savings — money workers can tap in the near term when unplanned bills arise — whether by signing up with SecureSave or using a similar service.
Now, you might ask, “Can’t I just give my employees a small bonus so they can kick start their savings efforts themselves?” And you certainly could. That would, in fact, be very generous.
But it’s just as important to get your employees into the habit of saving money from their paychecks on an ongoing basis. That’s why it’s worth starting a program where your employees can allocate money from their paychecks to land in an emergency savings account automatically each month. And if you’re able to match some of their contributions, even better.
Chances are, your business has some cash reserves to fall back on during a slump or to cover unplanned expenses, like equipment needing to be replaced. So, too, do your employees need emergency savings of their own. And if you’re willing to help them build some, you might benefit not just in terms of increased productivity, but also, employee loyalty.
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