HSA Day 2022: Tori Dunlap, Jennifer McClure discuss beating inflation with benefits

The annual inflation rate in the U.S. is between 8 and 9 percent in recent months. And only 18% of U.S. consumers said their wages are growing at the same rate as inflation, even though 63% of HR professionals said in another survey that inflation is being “considered or accounted for” in annual pay raises. That means tightening the wallets and purse strings for over 80% of U.S. workers. 

As one of our guests during our annual HSA Day 2022 podcast live recording said, “Everyone is feeling the crunch of the dollar going less far than it used to.” Joining us on Benefits this year to talk about what employers can do to help support employees in the face of decades-high inflation and in the wake of the Great Resignation were: 

• Tori Dunlap: Globally recognized money expert and CEO/founder of Her First $100K
• Jennifer McClure: CEO of Unbridled Talent & DisruptHR

Check out our Benefits episode below or keep reading to learn what you can do to help employees during these challenging times. 

The cost of inflation

An annual inflation rate of 8 to 9% can have a dramatic impact on an employee’s purchasing power. Let’s say an employee recently received a 5% raise, which increased his/her annual salary to $60,000 per year. While the 5% raise helps offset some of that inflation hike, that employee’s purchasing power is still less than it would be if you removed the raise and inflation from the equation. Even with the 5% raise, that employee may anticipate having 4 to 5% less purchasing power because of the difference between that raise and the annual inflation rate of 9.1%.

Drawing attention to benefits

While inflation isn’t the only reason some employees may feel their finances are stretched thin, benefits can be a way they can expand their purchasing power. But you already know that! One of the challenges in HR has always been finding the best way to communicate this to their employees. Dunlap suggests ditching a lot of the “official terms” HR typically uses and explaining health plans and benefits in a more relatable way instead.

“The government is incentivizing you to save by offering you tax breaks,” she said. “You get free money from the government for saving. When I phrase it that way … that’s how I would phrase it. That’s how I explain retirement accounts or HSAs (health savings accounts).”

Tori’s tips

Dunlap encourages small, positive habits. For example, she suggested everyone go into any savings or investment account they have and increase their contributions by 1%. It’s likely you won’t even feel it. She also thinks employers should do more to encourage employees to talk about money and their benefits with each other, which includes talking about their salaries. 

“There shouldn’t be retribution for talking about your salary,” Dunlap said. “If we’re going to encourage people to talk about money, they’re going to talk about it.”

Would you like more HSA Day insight? Check out our HSA Day page and watch our podcast episode today!

The information in this blog post is for educational purposes only. It is not legal or tax advice. For legal or tax advice, you should consult your own counsel. 

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