Whether you’re planning to integrate a financial wellness technology solution or a full-on digital transformation effort, here are a few ...
Many employers are overconfident about the success of their employee benefits. According to research conducted by MetLife Employee Benefits, almost one in two employers think that the salary and benefits package they offer makes their company a great place to work, compared to just one in three employees. This mismatch between what employees want and what employers are offering means that employers could be missing the boat when it comes to talent recruitment. Worse, they could be wasting time and money on the wrong things.
Listening to employees is key. And one thing they’re telling employers? Financial wellness is an enticing benefit.
What is Financial Wellness?
In a nutshell, financial wellness is anything that supports employees around their financial concerns. This might include:
• Retirement planning
• Financial health assessments
• Debt advice
• Holistic financial education, such as advice on money-tracking, budgeting, building emergency funds, investments and estate planning
• One-on-one money coaching
• Counseling to help employees cope with financial stress
Financial wellness represents a cultural shift. Gone are the days when employers would offer their workers traditional pension plans that guaranteed payments for life. Today’s pension landscape transfers the responsibility of retirement saving from employers to employees, and financial wellness programs may be the least employers can offer to compensate employees for the risk of managing their own contributions. And, with the lines between work and home increasingly blurred, it makes sense to empower employers to support workers through difficult situations, reduce financial stress and, ultimately, improve workplace productivity.
Is There a Place for Financial Wellness in the Workplace?
Financially stressed-out employees are bad for business. According to a recent survey by PWC, about one in four employees say that their personal finances have distracted them from their work, while about four in 10 employees say they spend at least three hours per week dealing with their personal finances. Those figures are even higher for millennials, who consistently struggle to climb out of debt and to save for the long term.
Reducing financial stress has a number of clear benefits — and not just for employees. Delivering a broad, finance-based wellness program affects how people feel about working for an organization. Employers delivering this perk should see a measurable uplift in employee recruitment and employee retention rate, boosting an organization’s reputation as an employer of choice.
Then there’ the destructive link between high levels of stress and absenteeism — a clear indicator of low workplace productivity. The Consumer Financial Protection Bureau estimates employers can save up to $3 for every dollar spent on financial wellness programs simply by making staff more productive. The same source also reports a drop in sick leave, disability and workers compensation costs.
Choosing a Financial Wellness Provider
With financial wellness such a hot topic in talent recruitment, it’s no surprise that 93 percent of large employers want to expand their financial wellness programs, according to insurance heavyweight Aon Hewitt. What makes a great program? One that displays the following features:
• An extensive curriculum that gives all employees high-quality financial advice based on their life stage
• Training delivered by a fiduciary financial wellness provider (one that is legally bound to act in the interests of the employee) to address every aspect of the employee’s financial life
• Guidance that is needs-based, customized to the employee’s specific vulnerabilities and delivered through the learning portal that resonates best with them (online, one-on-one, seminars and so on)
• A provider that tracks employee’s interest and participation in the financial wellness program and find ways to encourage further participation
Lastly, for a financial wellness program to gain traction, it should consolidate all employer benefits and providers. That way, employees receive a seamless program that allows them to take ownership of their financial situation and receive a suite of solutions. Employers purchasing such a program should experience remarkable benefits for their company’s financial health, too.