How do employees pay for unexpected expenses? Less than half use their savings and the rest turn to credit cards, personal loans, or borrow from friends and family, increasing debt and worsening financial stress.

More than a third of U.S. employees faced an unexpected expense, like a car repair or emergency room visit, that cost $5,000 or more last year, according to a recent survey by Bankrate.

Americans are already losing sleep and spending time at work worrying about their finances (costing employers up to $2,000 annually per employee lost in productivity). If only 40 percent of workers have enough savings to cover an unexpected $1,000 expense, even less have enough to cover a $5,000 expense.

Credit Cards and Personal Loans

Without savings to turn to, 15 percent of employees finance emergency expenses with credit cards they pay off over time. It seems like a solution that’s easy enough, but interest on unpaid balances adds up quickly. In 2018, Americans paid banks $104 billion in credit card interest and fees, according to Magnify Money by LendingTree.

The 6 percent of workers who cover an unexpected expense by taking out a personal loan run the same risk of snowballing into deeper debt if they’re unable to pay off the balance before interest hits.

Budgeting and Spending

Another 14 percent of Americans reduce spending on other things to cover an emergency expense. It might prove to be harder than they anticipated. Marcus by Goldman Sachs found almost 60 percent of Americans found tracking and budgeting expenses to be more stressful than opening a new savings account or trying a new workout.

Friends and Family

Borrowing from family or friends is how 13 percent of Americans deal with an unexpected expense. Most Americans are struggling with their own financial stress, but more than 80 percent are willing to make a major financial sacrifice for adult children, according to research from Merrill Lynch. Each year, parents spend twice as much supporting their children than they do making contributions to their own retirement ($500 billion spent on adult children, $250 billion in contributions to retirement accounts).

Unsure How to Cover Unexpected Expenses

An alarming 10 percent of Americans would either figure out “something else” or don’t know what they would do if they had to deal with an unexpected expense. Almost 80 percent of employees live paycheck to paycheck. More than half of the 3 in 4 workers that say they are in debt today think they will always be in debt.

Unexpected expenses add to the high level of financial stress most employees already experience. It’s overwhelmingly clear that employees need employer support to build emergency savings and prepare for life events like homeownership, raising a family and retirement. Employers who offer financial wellness programs and encourage employees to engage with them can help employees get back on track, so an unexpected expense doesn’t sink them further into debt.