I originally wrote this as an answer to a question posted on Quora.com. The post can be found there in its’ original form here, or through my LinkedIn page. We are incredibly excited here at Questis about how financial wellness technology (finwelltech), is helping build, shape, and improve America’s future both financially and otherwise. Without further ado...
Question: Why are financial wellness programs so “hot”?
The answer is simple: Delayed retirement is a major burden to employers and financial issues are the major contributor to this.
We are all familiar with the many negative manifestations of stress; and financial stress is no exception. In fact, a compelling argument could be made that many health issues are originally or eventually become a finance issue. But let’s deal with the cold, hard facts: a financially stressed employee has a significantly greater chance of missing work (absenteeism), being disengaged at work (presenteeism), or leaving their job altogether (turnover). All of these have real, quantifiable costs to employers.
How did we get here?
The shift from Defined Benefit Plans (Pensions) to very familiar Defined Contribution System (401k, 457, and so on) has left Americans woefully underprepared for retirement. The byproduct of this is an American workforce who is working longer, retiring later, and experiencing crippling levels of stress-related disease.
What have we realized?
Retirement planning simply has to start long before retirement. There are many factors that influence people’s financial journeys along with their ability to move towards a healthy, happy retirement. These things go far beyond what people’s 401(k)s look like. In short, Americans need to focus on the journey and start taking care of their day-to-day finances, budgets, student-loan debt payoff, credit card management, preparation for life events, etc. These are the things that, working alongside retirement advisors and the financial wellness technology tools they use, create a truly financially health, retirement ready individual.
So, I suppose I didn’t answer the question directly. In their own words, often the greatest inspiration for employers desire to implement a financial wellness program is that they “believe this is the right thing to do for their people.” This is one of the most uplifting statistics I’ve heard and perhaps why I am so bullish on taking the needed steps to improve the American worker’s financial future.
To bullet this out, here’s my take:
Employers see the value of financial wellness fiscally. A less stressed employee is less expensive, more productive, healthier, and more “retirement-ready.”
Employers see the value of financial wellness as a human capital advantage. Recruiting, retaining and retiring great employees is a boon to a firm.
Employers see the value of financial wellness from a “human” standpoint. Employees are a firm’s greatest asset and the employers truly care about their employees well-being.
The current generation of employees, especially millennials, have expectations that their employers will provide them more support and benefits.
With the already established resources, tools, human capital, and know-how, existing Service Providers (multiple industries) are in a natural position to deliver meaningful financial wellness for their clients.
Given the push towards wellness in the workplace, progressive companies have rapidly adopted financial wellness solutions over the past few years. The future grows closer day-by-day, and as point solutions fade and the industry trends to the inextricable link between health and wealth, more and more will continue to jump on the one way train to financial freedom.
The ‘Hot’ Year in Review
If 2017 was the year financial wellness ‘caught fire’, 2018 is where it starts to bear fruit. We’ll see the intertwining of human and robo-style platforms, more engaging and personalized solutions, and providers ready to support and grow America’s workers on their unique financial journeys.
So this is why financial wellness programs are “hot.” Personally, I’m proud to have a hand in how finwelltech continues to shape our world in the coming six, twelve, eighteen months, and far, far beyond.
Below are a few documents I have found insightful and useful. I spend my days talking to employers and learning about their wellness strategies, to financial service providers about how their approach to comprehensive wellness delivery, and to our own team about the exciting developments in financial wellness technology (finwelltech). I always enjoy speaking to those in the industry or learning more. Feel free to connect with me on LinkedIn or stop by our office in Charleston, SC, where Questis continues to be the engine powering some of the wellness industry’s most well-regarded solutions.