Are you aware that you can ask for early access to your pay in Australia? Or what early pay access is?
At Paytime, we define early page access as the ability to access your pay as you earn it. To cement the definition, here’s an example. Say you work your normal 8 hour day, when you clock off for the day, that means you have immediate access to 8 hours worth of your hourly wage.
We could use the space in this article to discuss increased inflation costs, and the increasing gap between cost of living and salary, but we’re sure you’re already familiar with this. Whether you’ve read it on the news or experienced it when visiting your local grocery shop, it’s no secret many Australians are currently enduring financial stress due the highest inflation rate on record, and therefore, significant increase in the cost of living. Did you know, in actuality, 50% of Australians live paycheck to paycheck and 33% do not have $500 incase of emergencies.
Although you may not be entitled to a salary increase, it does not mean you can’t better manage your finances and therefore improve your financial situation and overall well being. Many Australians don’t know this, but you can ask your employing organization to adopt Earned Wage Access (EWA). This is just another term for early pay access. By requesting pay early, every day is a pay day, you no longer live off a pay cycle and….
Have better financial freedom
Having real time access to the pay you’ve earned supports financial freedom and significantly reduces financial stress. To be clear, EWA does not stop bills from existing, however, it does provide regular income which enables you to better manage the bills as they come. EWA modernises receiving a salary and being salary-based by eliminating the rigid receival of pay on a particular day. Therefore, due to the flexibility and safety that comes with early pay access, you’re in a better mental and financial state to budget and handle everyday life. Reducing financial stress and improving mental wellbeing enables individuals to work with a better efficiency rate, productivity rate, and stay self-motivated.
Are prepared for expenses
This relates to both recurring expenses, such as streaming services or car registration, as well as when unexpected expenses arise. As mentioned, 50% of Australians live paycheck to paycheck, so if an unexpected bill pops up (such as a car accident or dental treatment), many individuals don’t have a financial buffer and take out a personal loan or cash advancement. The issue with payday loans lies with the terms and conditions of the loaned amount, as well as an establishment fee. Usually, there are high interest rates and relatively short payback periods.
Don’t fall into a debt cycle
Continuing from the previous section, the short payback period (sometimes as little as 16 business days) and very high interest rates results in individuals being unable to pay back the loan, even if it is a small amount, as once their pay day comes around they still have their standard bills and everyday living to budget for. Therefore, the loan rolls over to a new period, the amount payable increases at an expedited rate, and the credit history of the individual with the loan will suffer.
This then negatively influences credit checks, and may result in an individual having to take out a credit card to pay the loan back – only then to have to pay off the credit card (at a lower interest rate). Although they’ve reduced the interest rate, they’re still in a debt cycle that can be incredibly difficult to break. A poor credit history affects mortgage abilities, renting abilities, work abilities, etc, which causes very real problems and further financial stress. It usually takes 2 years or more to repair poor credit history, because once you’ve spent more money than you make, you’re constantly on the back foot trying to get out of debt.
Earned wage access breaks the debt cycle by providing you with a never-ending stream of cash flow. Having immediate access to funds, specifically funds that you’ve earned, you are able to better manage your finances, plan ahead, save money, and be prepared for any unexpected occurrences. Therefore, you no longer run the risk of needing to take out a cash advancement, personal loan, or payday loan.
How do you access early pay?
Accessing early pay, or implementing earned wage access, is simple and quick.
You, as the employee, can ask your employer to adopt EWA through a third-party business, such as Paytime. For your personal knowledge, when a company provides their employees with EWA it adds ZERO additional costs to the business (when they use a platform that seamlessly integrates with their existing payroll system).
Due to the lack of cost associated with the employee benefit, the ease of implementation, and significant value for employees, there’s no reason to feel hesitant about asking your company to provide access to your pay in real time.