Employers Working to Address Growing Concerns for Emergency Saving

HR leaders are struggling to manage the array of employee stressors related to a lack of emergency funds.


Amid workers’ growing concerns about being able to save money, an increasing number of employers are rolling out additional benefits, but human resources departments are still struggling to manage the various stressors of employees, according to HR experts and research from investment firm Edward Jones. 

A recent Edward Jones survey found many Americans lack sufficient emergency savings despite prioritizing financial wellness. Although 93% of Americans said financial wellness is a priority, 43% of respondents said they do not feel financially stable. When it comes to emergency savings, 28% reported feelings of stress, 25% felt concerned and 25% said they were anxious.

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“Understandably, inflation and market conditions are forcing consumers to spend more on necessities, like groceries and housing, so their savings are falling on the priority list,” said Meagan Dow, a senior strategist at Edward Jones, in the report. “When we get overwhelmed, it’s easy to put off thinking about things like saving for emergencies, paying down debt, or saving for retirement.”

Emergency saving programs, as offered by employers, have been a trending topic since the COVID-19 pandemic, with the recent SECURE 2.0 Act of 2022 including the opportunity for organizations to set up sidecar accounts or utilize retirement accounts for emergency savings by 2024. Last month, Delta Airlines and Fidelity Investments announced a team-up to offer Delta employees an emergency savings program that includes an employer match, similar to a 401(k) savings match.

Americans should have between three and six months of living expenses in an emergency savings fund, according to the Edward Jones researchers. However, only 38% of the more than 2,200 Americans surveyed in early January said their emergency savings fund is fully funded. Another 37% of individuals said they do not expect their emergency savings fund to last one month. More than one-quarter of respondents, 29%, reported they have less than $500 in their emergency savings. 

Employers Responding

Tom Kelly, a principal and the voluntary benefits leader in the health practice for Buck Global LLC, a consulting company, said employers are responding to Americans’ growing concern about emergency savings.

According to Kelly, about 25% of companies offer some form of emergency savings, and another 25% of companies plan to offer an emergency savings option in the future. 

“For a lot of years, financial well-being for organizations has been focused on readiness and long-term savings,” Kelly says. “They’re now seeing their workers and workforce dealing with a number of short-term financial stressors, and I would say their attention is shifted to: How do you help those employees living paycheck-to-paycheck?”

Kelly says one of the key areas is to help them save for emergencies. He believes Secure 2.0 will continue to increase the visibility of emergency savings. However, there remain many stressors for the average worker, according to Kelly.

“I think HR leaders are struggling: How do you address all of these?” Kelly says. “Whether it be mental health or caregiving, remote workers—they have a number of priorities that they deal with every single day. For HR leaders, it’s an area of focus: How do they begin to address some of these and put more meaningful solutions in place?” 

Save Up

Kelly says some organizations offer lifestyle spending accounts, through which employees can customize a suite of well-being benefits, including emergency savings as a subsidy. Employees can “pick and choose in areas that they see fit to kind of support a variety of well-being needs.”

Looking to the future, he thinks the concern over emergency savings is making a difference. “I think where organizations have rolled [benefits of emergency savings] out, we’re seeing really good adoption rates,” Kelly says. “It can be as high as 50% of employees adopting an emergency savings program.”

Kelly has seen an average emergency savings of about $100 per month, and employees are more apt to redeem those balances over time.

“Emergency savings make it easy for employees with things like payroll deduction and the ability to sign up for these programmers,” he says. “All of those factors will help more workers save for the rainy day.”

Social Security Expansion Act Would Guarantee Solvency for 75 Years

The Democrat-sponsored bill has been referred to the Republican-controlled House Committee on Ways and Means.


The Social Security Expansion Act, introduced earlier this week by Senators Bernie Sanders, I-Vermont, and Elizabeth Warren, D-Massachusetts, aims to make Social Security solvent through the end of the 21st century, while also enhancing benefits.

The bill would create a tax of 12.4% on investment income for individuals making $200,000 or more and married couples making $250,000 or more, matching the combined employee and employer payroll rates.

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The bill would also make all income greater than $250,000 subject to the full Social Security payroll tax rate; currently, income greater than $160,200 is not subject to the full payroll tax rate. Under the bill, income between $160,200 and $250,000 would not be taxed differently at first, but the $160,200 threshold would be allowed to rise normally until it reaches $250,000, projected to happen in 2035. At that point, all income would be subject to the full payroll rate. Additionally, any income greater than $250,000 would not be counted for benefit calculation purposes.

Since the bill would raise taxes, it must be formally introduced first in the House of Representatives. Sponsored in the House by Representatives Jan Schakowsky, D-Illinois, the bill was referred to the House Committee on Ways and Means on Tuesday. The bill has 26 co-sponsors in the House, as of today, all of whom are Democrats. Republicans control the House, and the Committee on Ways and Means is chaired by Representative Jason Smith, R-Missouri.

A statement from Sanders’ office said the bill would make Social Security solvent for at least the next 75 years, based on a study conducted by Stephen Goss, the chief actuary at the Social Security Administration.

Goss’ report explained that the bill would change the cost-of-living index used to calculate Social Security benefit increases from the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) to the Consumer Price Index for the Elderly (CPI-E). The report estimated that the cost-of-living adjustment would increase by “0.2 percentage points per year on average” as a result.

According to the Bureau of Labor Statistics, the CPI-E is a statistic which weighs inflation to account for the spending patterns of those aged 62 and older, such as their higher proportional spending on healthcare. The Bureau warned that this statistic has certain limitations, such as a smaller sample population, and currently has no official usage.

According to a factsheet for the bill, it would also increase the Special Minimum Benefit to 125% of the poverty line, “or over $18,000 for a single worker who had worked their full career.”

The bill would also increase the first income-percentage “bend point” from 90% to 95%. This means that, going forward, 95% of the first $1,115 in monthly wages (for 2023, indexed to inflation) would count toward Social Security benefits, up from 90%. This has the effect of frontloading benefit increases such that low-income workers benefit proportionally more from them.

Sanders’ office estimates that the annual Social Security benefit would increase on average by $2,400 a year.

The Senators propose the bill shortly after President Joe Biden was called a “liar” by Republicans during this State of the Union address for saying they were threatening to cut Social Security and Medicare to reduce the national debt. The risk of future retirees seeing reduced Social Security payments due to lack of funding has been a policy topic for years, with the Congressional Budget Office warning last December that the trust fund payments may be depleted by 2033, resulting in a 23% cut in planned benefit payments in 2034.

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