Frequently Asked Questions

Why is the initiative focused on employers?
What is the financial fitness of Minnesotans now?

How can people be thinking about saving for retirement given the current economy?
Why will direct deposit, retirement savings and financial education make a difference?
My company already has high participation rates in direct deposit and 401(k), so what else can we do?
How will we know that this work yields results?
What can my company do to help employees who are living paycheck to paycheck build financial stability?
How do I become an employer partner?

Why is the initiative focused on employers?

Employers have the ability to strengthen benefit plans, better communicate benefits and expand payroll options

Employers are in an excellent position to encourage employees to establish mainstream banking relationships and to save for retirement. Management and Human Resources staff engage employees on related topics, so they have opportunities to encourage financial fitness with purposeful advice.

What is the financial fitness of Minnesotans now?

Overall, Minnesotans do well against national averages, including saving for retirement. However, data suggests there are great disparities in financial fitness by race, income level and education level.

How can people be thinking about saving for retirement given the current economy?

Even small contributions, coupled with an employer match can yield significant earnings over time. Employees should be reminded a 401(k) is not a checking account, but rather a long-term investment for financial security. People cannot afford to leave money on the table in the form of an employer match. History has shown us that the markets will eventually rebound, and employees need to continue to save in order to realize those gains.

Why will direct deposit, retirement savings and financial education make a difference?

Employees who participate in direct deposit are less likely to use money exchanges and payday lenders because direct deposit requires an employee to either have a bank account or be paid via a payroll card. Payroll cards, or “stored value” cards, can be used to obtain cash at ATMs. Using a bank, ATM or stored value card to get cash saves employees money every pay period, because check cashing fees can add up substantially. People with bank accounts or stored value cards are significantly more likely to save a portion of their paycheck.

Saving for retirement—even a small amount—means that employees take advantage of employer matching and get into the habit of saving. This is a critical step in preparing our employees for their eventual retirement.

Financial education can help all Minnesotans be smart about their money, better manage financial difficulties and plan for the future.

My company already has high participation rates in direct deposit and 401(k), so what else can we do?

Look at your participation rates by race, pay grade and age. If you see disparities, work to close the gaps so that all employees are accessing your benefits.

Analyze the savings rates of employees and consider increasing employer match, and/or encouraging higher employee contributions. (See Assessment and Planning)

Share your successes to help other employers bring up their participation rates.

How will we know that this work yields results?

Financially Fit Minnesota has already collected some baseline data and will add Partner data as they participate in FFM. Routine data collection from Partners will be a part of FFM and analyzed to track progress. External research is also being considered.

What can my company do to help employees who are living from paycheck to paycheck build financial stability?

First, ensuring these families have a banking relationship is a crucial step to building financial stability.

Second, the FFM Toolkit provides contact information for community organizations that have demonstrated success working with families in financial crisis or who are struggling. Your employees can receive credit counseling, budgeting help, information on tax credits (Earned Income Tax Credit-EITC-and Minnesota’s Working Family Credit) and learn about other effective financial tools and skills.

How do I become an FFM employer partner?

Commit to making substantial improvements in participation rates among employees in direct deposit, retirement savings or both. Sponsor financial training or refer employees to community resources. Regularly provide data to Financially Fit Minnesota on your participation rates to assist with aggregate analysis of this initiative and possibly help other FFM partners.