To the editor:
Between my duties at work and my duties as a father, life can be quite busy. Managing and overseeing our family’s finances is part of our regular routine. With the cost of living on the rise, we are spending more time planning and budgeting to make sure we can provide our kids with everything they need to succeed.
I know that there are many working parents in Dallas County and across Iowa who feel the same way. Many of those families would benefit from resources that can reduce their financial burden and bring stability to their daily life.
One way that families can relieve some of these financial stressors is through earned wage access (EWA). EWA essentially allows someone to access money they have already earned from their paycheck before the end of a typical two-week pay period.
On-demand pay can be a lifesaver, especially when you need to make an unexpected trip to the doctor or cover childcare expenses.
This can be especially helpful for parents who are living paycheck to paycheck. It can be a daunting feeling knowing that you have an upcoming expense, but you won’t get paid for another week and a half. Earned wage access is a crucial tool for moments like this when the traditional payment model just doesn’t cut it.
Many employers are recognizing the value of EWA and offering it as an employee benefit because of the positive impact it can have on worker satisfaction and productivity.
Before programs like earned wage access existed, there were riskier, less effective ways for people to cover expenses and make ends meet. For a long time, payday loans and credit cards were the only options for people.
These options oftentimes take advantage of people in difficult situations. The high interest rates with both of these options can only cause further financial anxiety. Earned-wage-access tools, such as DailyPay, can provide a sense of security and ease the minds of hardworking parents.
Whether you are one of the families who benefit from earned wage access or not, it is hard to deny the value that this program has. All any parent wants to do is to be able to provide their kids with the most comfortable life possible, with endless opportunities to succeed. From summer camps, new school supplies and youth sports, these are opportunities that no longer have to be deferred because your paycheck hasn’t hit your account yet.
Earned wage access allows for those dreams to become a reality. Through earned wage access, financial freedom can be attainable for millions of Americans.
Dan Applegate
Earlham
I understand the need, but this is not financial freedom. This is going to the boss with your hat in your hand, begging for your earnings. Wage inequity is not solved with a cash advance. In this country of abundance, it is obscene that earned wage access is presented as a solution for living paycheck to paycheck.
Support unions. Join a union. Help establish a union where you work. Stand up, and fight for what’s right. Listen to Sen. Bernie Sanders and follow his lead. Bernie was always right.
I’ve looked further into this “service” of earned wage access (EWA). EWA appears to be a scheme thought up by ADP, other payroll processors and certain fintech startups to position themselves upstream of payday loan companies, thereby reaping the profit for themselves. The widespread adoption of this idea, even reaching the U.S. Congress, is particularly concerning.
Corporate lobbyists have presented a pre-written bill (accompanied by a campaign contribution) to lawmakers and had letters circulated to local editors by party members to disseminate public opinion, and now these intermediaries get to take an additional portion of individuals’ labor, despite providing no tangible value.
For an additional fee, they will offer a “subscription” service that ensures this extraction occurs every paycheck. While the Consumer Financial Protection Bureau (CFPB) recognized this as a threat to working people, Trump’s actions have effectively disabled the CFPB’s oversight.
In essence, EWA constitutes a scheme, with coordination from Congress, for the affluent to extract funds from those who are most in need. These companies say that a fee perhaps won’t be charged for every transaction, but isn’t the first one typically free?
Mr. Applegate, I ask you to refrain from portraying EWA as a benefit for working people. It is not.