Chime and Salary Finance benefit gives employees free money

Employees are notoriously lacking in savings as they prioritize today’s financial needs over tomorrow’s financial security.

In an effort to help employees boost their bank accounts, financial wellness company Salary Finance has teamed up with tech company Chime to launch a savings benefit that will help employees create good monetary habits and also reward them for putting money away.

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Employees can open a high-interest savings account connected to their employer’s direct deposit, allowing them to save directly from their paycheck. The benefit also provides a fee-free overdraft feature, early access to direct deposits, and a “save while you spend” feature that allows employees to round up their spending and put it toward their savings.

“What we wanted was to enable employees to be able to save automatically, almost without thinking about it,” says Dan Macklin, CEO of Salary Finance. “The ultimate goal is to have more employees saving and the more immediate goal is to have more employees who have emergency savings.”

Employees are dealing with a range of financial issues and emergencies, causing their long-term savings goals to take a backseat. Just one-third of full time employees have less than $1,000 saved for unexpected expenses, according to PwC data.

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Financial wellness has become a hot topic in the employee benefits space, as employers seek to combat the stress and unease employees face due to money woes. When employers make investments in the financial well-being of their workforce, it can improve mental and physical health, increase focus and productivity and reduce absenteeism and turnover.

“Employers have recognized that employees’ financial needs have become more complex, so they have to take more responsibility to help them,” says Kevin Crain, the head of workplace solutions integration at Bank of America. “[We’ve seen] tremendous increases in terms of offering education, guidance and tools around budgeting, saving for college and debt management.”

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Salary Finance joins organizations including Betterment and Voya, who also ramped up their financial wellness benefits.

The Salary Finance and Chime partnership has also added an incentive feature as a way to encourage and positively reinforce good money habits. For every $100 saved, employees will receive an additional $10 to their account, Macklin says.

“If someone is able to save $500 in the first six months after the account is open, that can be an extra $50,” he says. “That's really our effort to encourage more people to do it than otherwise would. Employers like the fact that there's an extra incentive here and we believe that it will be very successful in helping to convince lots of Americans they should be saving.”