FCSfit Goal: Get Your Savings on Track!
Split Deposit: The Workplace Perk that Will Help Employees Build Wealth By Bill Sullivan, Senior Director and Group Manager for Government and Industry, NACHA (NACHA – The Electronic Payments Association is the steward of the ACH Network)
AAFCS is excited to be a 2018 partner in America Saves Week, coming up Feb. 26 - March 3rd. Started in 2007, the Week is an annual opportunity for organizations to promote good savings behavior and a chance for individuals to assess their own saving status. Thanks to America Saves for providing the content for this edition of Wellness Wednesday! Got a savings goal of your own? Share on our FCSfit pledge wall for a chance to win our February drawing!
American workers are not saving enough for their future or to even cover emergencies and planned expenses that may crop up in the short term. According to the Federal Bureau of Economic Analysis, the average personal saving rate for Americans hovers around 5 percent
– which is far too low. In fact, people aged 30-49 are the most likely of any age group to have no emergency savings, according to Bankrate.com.
One easily accessible solution that is simple, safe, flexible and smart is for workers to enroll in Direct Deposit via ACH and start or build their savings using Split Deposit
. Direct Deposit enables workers to have their pay electronically deposited into their bank accounts so they can have access to their money on payday. “Splitting” a Direct Deposit is the ability to automatically direct a fixed percentage or dollar amount of pay into a savings or investment account.
Direct Deposit via ACH is the most widely used method to pay workers. Yet its least discussed benefits – and probably greatest incentives to convert any holdouts – is its ability to help workers increase savings
, while helping employers build their bottom line.
For workers, the importance of automatic savings – particularly through Direct Deposit and Split Deposit – to their financial future cannot be overstated. According to research
conducted on behalf of NACHA—The Electronic Payments Association, 72 percent of users say it helps them better control their finances, and 85 percent say it helps them save.
The study also found that 82 percent of workers receive Direct Deposit of their pay, but only 24 percent use Split Deposit – despite it being one of the easiest and most effective ways to grow savings and build wealth. Of Direct Deposit users who split their deposits, 73 percent said they are likely to continue doing so. In fact, consumers who split their Direct Deposit save up to $90 more per month than those who use another method to save
To help further highlight the value of Split Deposit in building wealth, NACHA
partnered with America Saves and ePayResources in 2017 to launch the “Split to Save”
initiative. The campaign is designed to educate workers on the benefits of Direct Deposit and Split Deposit, and provide organizations with educational resources available via a toolkit
to share with their constituencies.
The campaign welcomes businesses, financial institutions, federal and state government agencies, banking groups, consumer organizations and more to join this initiative to promote Split Deposit as a way to automatically grow savings.
Everyone wins when more people are introduced to saving automatically and are empowered to take control of their financial future.
For more information about Split Deposit, Direct Deposit, and partnering with the “Split to Save” campaign, visit ElectronicPayments.org
or contact Bill Sullivan at WSullivan@NACHA.org