To give employees the best chance at
According to the Federal Reserve Bank of New York, household debt in Q2 of this year hit $18.39 trillion. From credit card and medical debt to student and car loans to mortgages, employees are dealing with the stress of being financially underwater,
To help employees dig out of debt and build better habits, comprehensive financial wellness solution BrightDime already provides members with budgeting tools, educational resources and digital and live coaching for every aspect of their
Augie's secure credit card, which requires no down payment and is interest- and fee-free, helps members pay bills they already have while monitoring their bank accounts to ensure they can pay off their balance.
The idea is to interact with users in multiple ways to instill budgeting skills, establish or improve credit, and get on the road to a healthy financial future. When an employer brings BrightDime on as a benefit, they can elect to include Augie as well, offering employees an invite code directly to the app.
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Debt and credit's impact on the workplace
Knowing the struggle many Americans face from a lack of credit score education and living paycheck to paycheck, both of which make it easy to fall into debt, the decision to partner with Augie was easy, says BrightDime founder and CEO David Stedman.
"There are people from ages 18 to 65 who have bad credit scores; it does not discriminate," he says. "Probably 85-90% of our coaching sessions are about debt management or paying down debt, and with that comes 'How do I increase my credit score?' Augie makes it super simple for employees to do this."
Once employees are on the path to less debt and better credit, they're more likely to engage in other financial wellness benefits, too, Steadman says.
"If their credit is really bad, employees will not participate in all the other wonderful products, such as a 401(k), HSA or emergency savings," Stedman explains. "[Leaders say] 'I can't believe we don't have 100% of our employees participating in the 401(k) because we have such a great match.' The reality is, a lot of those employees truly need every single dollar they make. If they don't understand the importance of their credit score, [credit issues often start] early on in life and it is hard for people to claw their way back."
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Augie's approach
In order to be issued a credit card through Augie, employees must pass the company's Know Your Consumer (KYC) and have an account with a U.S. bank. Once they are set up, they go through onboarding that helps them take a close look at their bank account activity and set up payments for their typical expenses on their new card.
If a member's bank account balance gets too low to pay off the bills that are scheduled to get covered by the card, they will get an alert and followups from the platform so they can avoid further debt. Augie also provides education into how to utilize credit wisely, boosting their financial confidence even more.
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For employers, helping people establish better financial health through an employee benefit is on par with improving any other area of health: It is a way to reduce people's stress, increase their focus and improve business, says Paul Harkins, Augie's co-founder.
"Employers are trying to get their employees better in their mind and in their body, and a big part of someone's better is to be financially sound," he says. "They realize that the happier and more confident a human being is, the better employee that human being is."
Read more about financial wellness benefits and strategies:
It's time to remind employees to use their FSA SHRM survey reveals widening gaps in caregiving and well-being support Navigating retirement insecurity with the right workplace benefits Are employees getting what they need from their 401(k)s? Retirees have no financial plan: How benefit managers can help employees now
