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.”1 For 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? By 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 professional. Financial wellness training is increasingly seen as a standard component of a competitive employee benefits package, with 97% of employers feeling responsible for their employees’ financial wellness and 80% of employees agreeing, thinking employers do have a role in their financial well-being, according to Bank of America’s 2022 Workplace Benefits Study.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 confidence through tools like income protection insurance. In other cases, employees may want guidance in making a savings plan — for example, while 61% of workers overall are already saving for their child’s education, only 47% 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 help 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 help 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’ financial well-being, 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
Bank of America’s 2022 Workplace Benefits Study found that 91% of employers see higher employee satisfaction when offered resources to manage well-being. 7 Further, Plan Sponsor Council of America’s latest annual survey found that more than 1 in 4 employers now offer a comprehensive financial wellness program. 8 And PwC’s 2022 Employee Financial Wellness Survey discovered that 73% of employees whose productivity at work is majorly impacted by their financial worries also say their finances have significantly affected their self-esteem. 9 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 well-being 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.
SOURCES:
1 It’s a Scary Time Financially. How to Avoid Panic, CNBC, October 23, 2020
2 Workforce 2020: Women and well-being, Guardian.
3 2022 Workplace Benefits Study, Bank of America, 2022.
4 Workforce 2020, Guardian.
5 Financial Wellness is Now a Requirement, Not a Perk, Entrepreneur, November 27, 2020
6 Happy Employees and Their Impact on Firm Performance, London School of Economics, July 15, 2019
7 “Bank of America study finds 84% of employers now say offering financial wellness tools helps increase employee retention,” Bank of America, September 27, 2022
8 Correia, Margarida, “Financial wellness to top employer priorities in 2023,” Pensions & Investments, January 16, 2023
9 2022 PwC Employee Financial Wellness Survey
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