Pay it Forward: Financial Wellness for Employees
Are your employees experiencing financial stress? With money still a taboo topic for many, the people who work for you may be suffering in silence, bringing unspoken financial stress to their jobs. A survey by the American Psychological Association in 2020 found that nearly 2 out of 3 adults say money is now a “significant source of stress.”1For women, the pain is even more acute, with 64% reporting that money is “the leading cause” of stress in their lives.2 How can you help them? To answer this question, companies are increasingly offering financial wellness training to employees.
WHAT IS FINANCIAL WELLNESS?
A financial wellness program is a workplace benefit where companies provide employees training and support for managing their financial lives. The support can come in a variety of forms. Some companies choose to help through in-person or online financial workshops. Others use web-based tools that allow employees to self direct their own program. Alternatively, some companies facilitate one-on-one meetings between an employee and a financial representative. Financial wellness training is increasingly seen as a standard component of a competitive employee benefits package, with the percentage of employers offering financial wellness programs rising from only 20% in 2015 to over 80% by 2018.3
FINANCIAL WELLNESS EXAMPLES
These programs address common money issues, such as helping people get a handle on debt. They can also support employees in setting up financial safety nets through tools like income protection insurance. In other cases, employees may want guidance in making a savings plan — for example, while 61 percent of workers overall are already saving for their child’s education, only 47 percent of single parents have been able to set money aside.4 Financial wellness programs can cover a range of issues and be tailored to an employee’s specific needs.
FINANCIAL WELLNESS CAN BOOST THE BOTTOM LINE
Employees who worry about money are often distracted and less productive. In fact, one study found a financially stressed employee may spend up to three hours a week dealing with money issues. When someone is in this situation, they have a 7.5 percent decrease in productivity.5
FINANCIAL WELLNESS CAN REDUCE TURNOVER
Through financial wellness support, employers give people tools to help make sense of their financial lives and make a plan moving forward. As a result, workers feel less stressed and become more engaged on the job. Happier employees tend to stay on the job longer, reducing turnover rates and the expense of finding new talent.6
WHO CAN OFFER FINANCIAL WELLNESS?
A company doesn’t have to be huge to offer financial wellness training as an employee benefit. To this point, some larger companies have spun their programs into standalone modules that smaller businesses can use. Also, given the range of ways to support employees in financial wellness, your company can use anything from free online tools to more resource-intensive programming. A financial professional can help you survey the available options and how they can meet the specific needs of your employees.
FINANCIAL WELLNESS TRAINING IS IN DEMAND
Even before the COVID-19 pandemic, more companies were introducing financial wellness benefits for their staff. But now, as people face continued economic disruption, financial confidence has taken a hit. Further, in a 2020 survey, PwC found that over two-thirds of employees want financial guidance during key decision points or in times of crisis.7 With this in mind, financial wellness training is more needed than ever — for businesses of any size.
When people are worried about money, whether it’s debt today or a big purchase tomorrow, they carry that worry into the workplace. Financial wellness training can support your employees in managing the stress today — and in finding a path to greater clarity and confidence for the future. If you’re interested in bringing greater financial and emotional confidence to your employees, a financial professional can help you find the right program for you and your team.
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2021-120436 Exp. 4/2023
1It’s a Scary Time Financially. How to Avoid Panic, CNBC, October 23, 2020
2Workforce 2020: Women and well-being, Guardian.
3Benefits and Beyond: Employer Perspectives on Financial Wellness, Prudential, May 2018
4Workforce 2020, Guardian.
5Financial Wellness is Now a Requirement, Not a Perk, Entrepreneur, November 27, 2020
6Happy Employees and Their Impact on Firm Performance, London School of Economics, July 15, 2019
7 9th Annual Employee Financial Wellness Survey, PwC, May 2020.