A New Lump Sum for a New Generation

Think about the
last time you
paid someone
back.

Regardless of what
medium you used, you
probably used some
type of technology.

That being said,
here’s a question:

Why should
relocation be any
different?

The truth is, the way many companies
administer lump sum, is a bit...

And the numbers
speak for themselves:

73%of Millennials would rather
handle financial needs with
Google, Amazon, Apple, PayPal
or Square than from their own
nationwide bank
Source: Millennial Disruption Index

33%believe they won't even
need a bank in the next 5
years.
Source: Millennial Disruption Index

We’re going to teach
you how this applies
to lump sum.

Let’s talk about the way
lump sum used to be
(and in some cases still is)
distributed.

step 1:New hire accepts the
offer and agrees to
relocate

step 2:New hire signs
repayment agreement
(which, if this is offline, they have
to fax, scan, or mail it back)

step 3:New hire finds a time to talk
to their employer to gather bank
account information or an address
to send the lump sum amount

step 4:Employer hands off the
information to their third party
or in-house team that
handles the transfer of funds

step 5:Everyone hopes that as the
information passes through all of
these people, nothing is lost
in translation or entered
incorrectly

step 6:Employee waits.
Employer waits.
No one has insight into
where the money is.

While all of this is
happening, here is what
your transferee is
thinking:

I just deposited a check into my bank
account by taking a picture,
but these are all the steps required for
me to get my lump sum?

It just doesn’t make
sense to them.

We know what you might
be thinking.

“We just give our transferees their
lump sum in their first paycheck! No
need to fuss with this nonsense!”

This leaves transferees in financial stress, especially those who are
younger, entry and middle level employees. Waiting until the first or
second paycheck to pay your employees causes a reluctance to spend
money on relocation expenses, ultimately leading a haphazard and
unorganized move.
AND, to add icing on top of the cake, you have to pay $10,000 for
your transferee to have a bad experience and begin their journey
with you on the wrong foot.

Give your transferees the
lump sum ahead of time,
and in a way that they are
used to receiving it:
Quickly.
Easily.
Online.

Through a technology-driven
lump sum disbursement solution.

Taking this traditionally offline process online allows
employers and employees
to benefit from a more streamlined process.

Employers can manage the
distribution process from a single
platform, and employees can
easily (and securely) claim their
lump sum.

Here’s the new
breakdown of steps:

step 1:Employee confirms the
lump sum amount their
employer sent over

step 2:Employee signs the
repayment agreement
electronically, right in the
same place

step 3:Employee enters their
bank account information

The money is deposited into the
employee’s account, and both
parties have transparency into
this process the entire time.

Let’s take a look into how this process
helps each person involved in the lump
sum distribution process.

94%of Millennials are active
users of online banking
Source: Forbes

“For this hyper-connected and tech-
savvy crowd, finance is more
synonymous with crowdfunding,
virtual currencies, and online payment
platforms than it is with the brick
building with a drive-thru ATM on the
corner.”
Source: Forbes

They simply respond better to technology.
They’ve grown up with it.
They’re used to it.

For these reasons alone,
moving to an online
solution will be beneficial
for transferees.

It’s no secret that lump sum isn’t
enough to supplement an entire
relocation.

By giving them an easy and seamless experience with smooth
user interface, they’ll be able to overcome one of lump sum’s
biggest hurdles:
THE COMPLICATED NATURE OF DISBURSEMENT.

Transferees will be able to easily access their money not only
because the process is relatively straight forward, but because it
is similar to what they are used to. Your younger transferees
are used to seeing money process at the blink of an eye.

Receiving instant gratification is
second-nature to most of your
employees. They want choices,
and they want their choice to have
an instantaneous effect.

Making them go through a
complicated and drawn-out process,
one that only leads to them being left in a waiting game
until their money comes through, probably won’t be
something your transferees are used to.

By moving this process online, the
steps will be much more intuitive to
transferees, removing a
layer of confusion in an already
complicated situation.

Think about all the
things that can go
wrong in your day.

From the minute you get to work until the
minute you leave, your day is probably
filled with various tasks that have you
running in multiple different directions.
The room for error is pretty substantial—
with any job, really.

And while some mistakes
are small and fixable,
some are a little more...
complex.

This is one of the huge benefits of an
online lump sum disbursement tool.

It removes a series of tasks that have a
pretty large margin of error.

Whether it’s making sure your transferees are
connected with the right people, making sure
you have the right address (physical or email),
making sure you’ve securely received and
processed their information, making sure the
money was successfully sent—there are a
plethora of ways that human error can get in
the way of the lump sum disbursement

Now let’s add taxes to the mix.

Calculating taxes is a time consuming process that has no
“official owner” in most companies. Compiling the tax
reporting doesn’t necessarily fall on the shoulders of
Accounting, but adding that to the plate of HR/Recruiting
isn’t always the best solution either, since they have a lot
on their plate to begin with. At the end of the day, it falls
on payroll to report this information, but it falls on HR to
gather all of the information from each subsidiary.

An online solution will help educate both
the employer and the employee on tax
rates, gross-ups, withholdings, and
anything else that typically falls in
between a variety of departments.

In addition, the insight that real-time reporting
gives employers is extremely beneficial.

Not only do employers gain transparency and insight
into the status of their employee’s lump sum, they can also
identify issues with bank accounts immediately, run
reports on how much has been dispersed, how much is in
transit, and unveil some of the data behind their
disbursements.

At the end of the day, you can have the most streamlined of systems and
the most advanced technologies, but none of it matters if you aren’t
communicating effectively with your employees.

Technology can be an extraordinary tool to
guide your employees through their
relocation, but without your communication
on what is available (and how to use it),
your solutions may not end up living up to
their full potential.

Don’t lose sight of the fact
that while lump sum is a very
viable solution to supplement
a relocation, it should be used
as a complement to other
tools that help employees
navigate their relocation.

The nature of lump sum is
complicated.

The process from start to finish is
granular and fragile.

And there’s a lot to understand for both
employer and the employee.

Arm transferees with the resources
they need to be successful, and their
successes will span more than just
their relocation!

A New Lump Sum for a New Generation

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