Financial wellness programs are attracting and retaining the best employees
Have you heard about the new workout in the workplace? It's called financial fitness. So, what exactly is financial fitness, why are employers increasing the presence of such programs and how do they work?
Employees today want more than basic retirement resources these days; they are looking for help with basic budgeting, debt management and investment. They want to know what is needed to be financially secure enough to buy a house and be prepared for saving for any potential health issues. Currently, a little more than half of employers offer at least one of those services to their employees, according to a new report from benefits consulting firm Awn Hewitt. It is estimated that by the end of the year, 77% of large and mid-size companies will offer at least one financial wellness program and 52% will offer programs in three or more categories.
Financial wellness programs are going beyond offering basic tools and expanding into areas of specific concern for employees. Some may get the opportunity to meet with a financial planner and another group may receive education on student loans.
According to a PricewaterhouseCoopers survey, slightly over half of workers say they are stressed about finances, with 45% saying that their worries have gotten progressively worse over the past 12 months.
Financial wellness programs could include education and tools related to short-term and long-term savings, budgeting, managing debt, loan repayment options etc. Four out of five financial executives agree that having a financially secure workforce is a benefit to the company. 78% feel that employers should assist employees achieve financial wellness during their working years. Having a financial wellness program not only benefits the employee, but also the employer. Employees are more productive at work and less anxious. Currently, 46% of employees admit that they spend at least 2-3 hours a week on personal financial matters while at work, and one out of five report missing at least one day of work in the past year to tend to personal financial matters. Financial stress also has an impact on the health of the employee. People who are stressed about finances are twice as likely to have a heart attack, and 44% are more likely to suffer from migraines.
While a high percentage of companies report wanting to offer financial wellness programs to their employees, many lack resources and find it very challenging. The following best practices have been recommended when implementing a financial wellness program:
- Integrate the financial wellness aspect with another benefit offering: Two-thirds of employers with financial wellness programs in place say that they are deeply integrated into other financial programs such as retirement or even health and wellness offerings.
- Stay with the basics: 86% of employers that currently offer financial wellness, report that personal finance basics are the focus, such as debt management and budgeting.
- Customize your program to your employees' biggest financial needs: Workforce demographics and psychographics can vary greatly between companies. Designing a program that revolves around your workforce is absolutely necessary.
- Utilize "high-touch" methods for delivery: Employees (73%)say that seminars, one-on-one coaching and phone support are the most effective means of delivery for these types of initiatives.
Many employers fear not getting it right, but starting out simple and building on the basics is an efficient way to get started. Utilize financial resources outside of your organization to help host seminars and provide educational materials. The benefits far outweigh the risks. Employers end up with more dedicated workers, longevity of employees and higher production. Employees have an overall feeling of stability, reduce their stress and miss less work. These programs are also an excellent way to attract and retain the best talent.