Once you’ve diagnosed your employees’ needs, a financial health gap assessment can help you identify areas in your current programs and policies that could be improved with enhancements to existing programs or new solutions.
Imagine that in response to your survey, a significant number of employees report that they have less than two weeks’ worth of living expenses in emergency savings.
In looking at your benefits data, you discover that few of your hourly employees participate in your company’s 401(k) plan, and a fair number of those who do participate have recently taken out small loans from their retirement accounts.
This data would suggest that your hourly workforce may lack emergency savings, which may even lead them to borrow against their 401(k) when unexpected expenses arise, if they are even able to contribute at all.
Then, your financial health gap assessment may reveal that, though your company pays its hourly workforce a living wage and offers generous health and retirement benefits, it doesn’t currently offer any tools to help employees to save for the short term. Given the serious risk to employees’ long-term security from drawing down 401(k) balances or not saving for retirement at all, you and your team might decide to create an emergency savings benefit as part of your 401(k) plan (i.e., “sidecar” savings).