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December 2014/January 2015  Volume 5, Number 6        
 

1

Give Employees More Buying Power through Payroll Deduction

If early season trends continue, Americans could spend more this holiday season than they have in several years. Employee purchasing plans can help employees avoid a post-holiday financial hangover.

Earlier this fall, experts predicted that holiday season retail spending could increase more than 4 percent over 2013’s figures. Unfortunately, that holiday cheer can often result in a post-holiday financial hangover, as consumers face credit card debt for their purchases. An employee purchasing program can help employees buy big-ticket items this holiday season without scrimping—and without amassing unnecessary interest charges.

Here’s how.

Employers sign up with a vendor, which offers their employees access to an online catalog of merchandise available for sale. Products can range from electronics to furniture to jewelry. Some merchants even offer purchasing programs for college courses or other educational services, such as SAT preparation classes.

When an employee buys something through the catalog, he or she can pay for it over time, with convenient payroll deduction. The vendor handles the work, including fulfillment. All the employer has to do is allow the vendor to make automatic payroll deductions.

Benefits for Employees

Employees can buy things they otherwise might not be able to afford, without resorting to charging their purchases on a credit card. And unlike layaway plans, purchasing plans let employees enjoy their purchases immediately. Other benefits, which might vary by vendor, can include:

  • Access to first-quality name-brand merchandise, with manufacturer warranties where applicable
  • All costs disclosed upfront—no additional fees
  • No credit checks
  • Affordable installment payments
  • Convenient payroll deduction
  • Zero percent financing
  • No overspending—the purchasing plan vendor sets a spending limit for participating employees based on their salary.
Benefits for Employers

Employers gain a benefit program that helps employees maintain a better work/life balance. The employer has no costs or administrative responsibilities — the vendor handles marketing, administration and fulfillment. The employer bears no liability for products or services, or for unpaid balances if an employee leaves the organization before his/her purchase is paid up. If that occurs, the vendor will arrange a payment program directly with the employee.

Purchasing programs usually set a spending limit for each participating employee based on the employee’s salary. This helps prevent overspending and the resulting financial stress, which can affect an employee’s productivity at work. In fact, in the 2013 PricewaterhouseCoopers Employee Financial Wellness survey, nearly a quarter of employees admitted that personal financial issues have distracted them at work. Among these employees, 19 percent said that they spent five or more hours per week at work dealing with or thinking about their personal finances.

Purchasing programs are just one way to help employees better manage their time and money. For more information, please contact us.

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In this issue:

This Just In...

Insure Your Part-Time Workers at No Cost

How Do Your Life Benefits Measure Up?

Give Employees More Buying Power through Payroll Deduction

The Advantages of Online Benefit Administration

 

 


The information presented and conclusions within are based upon our best judgment and analysis. It is not guaranteed information and does not necessarily reflect all available data. Web addresses are current at time of publication but subject to change. SmartsPro Marketing and The Insurance 411 do not engage in the solicitation, sale or management of securities or investments, nor does it make any recommendations on securities or investments. This material may not be quoted or reproduced in any form without publisher’s permission. All rights reserved. ©2013 The Insurance 411. Tel. 877-762-7877. www.theinsurance411.com