Many Employees Are One Emergency Away From a Financial Fiasco

According to the Federal Reserve Board’s Report on the Economic Well-Being of U.S. Households in 2015, almost half of all Americans are ill-prepared for unexpected expenses and would struggle to cover the costs associated with an emergency.

For example, the survey results revealed that:

  • Forty-six percent of adults say they either could not cover an emergency expense costing $400, or would cover it by selling something or borrowing money.
  • Twenty-two percent of respondents experienced a major unexpected medical expense that they had to pay out of pocket in the prior year, and 46 percent of those who say they had a major medical expense report that they currently owe debt from that expense.

A substantial share of Americans also lacked retirement savings and fewer households were confident in the outlook for their income at the end of last year. With money being named the number one source of stress for Americans since the American Psychological Association began reporting these statistics in 2007, it’s important for employers to recognize the impact that poor “financial fitness” may have on their workplace.

Employees who are worried about their finances have admitted to being distracted at work, often leading to a decrease in productivity and excessive absenteeism. This is why many employers are looking toward increasing their employee total compensation packages with voluntary benefits. Programs such as accident and critical illness insurance can help an employee bridge the gap to financial wellness and create a more balanced and focused work environment. Click here to read more.

More information about this study can be found here from the L.A. Times.

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