Is it difficult to get financial assistance from your employer? It’s very possible that your employer will be able to help you if you are in a tricky financial situation. This is especially likely if you work for a large company, as many larger businesses have schemes in place to assist their employees. Your employer may be willing to provide you with an advance on your paycheck, or an interest-free, low-cost loan to tide you over while you get back on your feet.
These schemes are relatively common, and following the financial onslaught of Covid-19, many employers have developed new ways to support their workforce.
- Sometimes you can get financial assistance from your employer. Many will be happy to financially assist you if you find yourself in a sticky financial situation.
- A cash advance may be available to you, which is when your employer essentially grants you an early paycheck.
- In extreme situations, you may be eligible for employee relief funds.
- Many employers financially help employees who wish to attend further education. Such employers include Amazon.
- Financial assistance from employers is more common within larger firms.
What Kind Of Financial Assistance Can I Get?
- Cash Advance – A cash advance is an advance on a future paycheck, essentially bringing your payday forward. This could also be an interest-free loan the size of your monthly salary which you could receive up to 30 days in advance. However, there may be stringent terms surrounding a cash advance, such as when this must be paid back. Failing to pay a loan back promptly could lead to funds being deducted from future wages. Many employers will have limits on how frequently cash advances can be used, and won’t allow employees to use them on a monthly basis.
- Employee Relief Funds – Employers can also contribute to public charities that provide employee disaster schemes on behalf of employees. Assistance can only be claimed in this form if you find yourself in exceptional circumstances and can’t stay afloat without help.
- Direct Payments To Employees – In extreme cases, under Section 139 of the Internal Revenue Code, employers may issue disaster relief payments directly to employees to help them support themselves if a federally declared disaster has taken place. These funds will be used to cover costs such as funeral expenses, medical costs, or childcare. You will only qualify for these funds in exceptional circumstances, and if the payments you need to make are not reimbursable by insurance or other assistance.
Is Financial Assistance Available In All Companies?
The short answer is no. These schemes are not universally used by all employers and are more common within large organizations with high profits, or those companies that place emphasis on the wellbeing of their team.
For instance, during the Coronavirus pandemic, not all companies provided financial assistance schemes. However, this period of time saw large companies, such as Kroger and Walmart, offer bonuses and pay raises to employees.
You may find that when you receive support from your workplace, funds are withdrawn from future paychecks. Either way, it is reassuring to know that help is there when you need it.
Find out if your company is affiliated with a credit union where you can get loans at lower rates.
What If I Need Money For Further Education?
Many companies, such as Target, Walmart and Amazon, offer schemes to provide employees with funds to return to education. These employers partake in tuition reimbursement, investing in their workers’ skills and education.
If You Get Financial Assistance from Your Employer – Plan Carefully For Repayment
If you approach your employer asking for financial support, make sure you have a repayment plan in mind. You should know how and when you will be able to pay off your debts.
While cash advances typically bear no-to-low interest rates, the debt itself (and any potential interest!) are pressing debts that should be paid back promptly and as you have agreed with your employer.
What If I Don’t Want To Ask My Employer But Need Financial Support?
Don’t panic! There are plenty of alternatives to asking your employer for support. You could ask a loved one for support, adjust your budgeting technique, or sell items that you don’t need or want anymore.
Bankruptcy should always be a last resort as it has lasting effects.
Alternatively, you could consider seeking a loan from a bank or payday lender. There are tips to consider before taking out a payday loan. These loans, while expensive, can provide you with funds within one day of applying, and means that you won’t need to have a personal and revealing conversation with your employer.
Consider borrowing from friends and family.
If you are unsure of which avenue is best suited to you, you could contact a financial adviser and seek their advice.