Despite recent economic growth and falling unemployment, many American workers are still struggling to make ends meet. Financial capability programs can help participants alleviate some of their financial struggles through knowledge and access to the products and services they need to manage their financial lives effectively. CFED recently profiled programs that are integrated into the workplace setting.
Employers often manage large components of their employees' benefit programs and sources of income, which means they are uniquely positioned to connect their employees to financial capability services. One such service could be to increase employee savings, a goal supported by research from the US Financial Diaries:
Many existing programs focus primarily on long-term savings, which is important for financial security. But short-term savings are often more crucial to an individuals’ ability to respond to a financial emergency. Many low- and moderate-income households, despite seeing the need to have these emergency funds, are unable to meet their savings goals. The U.S. Financial Diaries addresses the scale of this problem and finds that as little as 7% of households were able to meet their emergency savings goals.
The full article from CFED is available here. For more on how savings impacts USFD households, explore our latest issue briefs on Emergency Savings and Savings Horizons.