Most of us are familiar with employee wellness plans offered by employers in conjunction with medical insurance. These plans may offer education about disease, diagnostic tests, physical fitness, etc. and often include a financial incentive to employees who participate in the plan. What you might not have heard of is the growing trend toward financial wellness programs being offered by employers.
The statistics are staggering in that Americans have named money as their number one area of stress every year since 2007 when the American Psychological Association started its report “Stress in America.” In 2014, “Big Four” accounting firm PwC reported that a quarter of employees whose employers offer financial wellness programs stated that their money worries have taken significant time away from their work days, reporting that as much as three work hours per week are lost to issues dealing with personal finance. Seven out of ten Human Resource professionals indicate that personal financial issues have a great impact on their employees’ performance and ability to focus on work, as reported by the Society for Human Resource Management (SHRM) in their May 2014, report “Financial Wellness in the Workplace.” These figures combine to form a picture that shows that financial wellness has become an area in which employers can truly assist their employees, while providing them much-needed stress relief.
As with physical wellness plans, experience shows that the best programs are tailored to the individual needs of the particular group of employees, with attention to their age, upcoming life events, current credit situation, etc. There is no “one size fits all” approach, since differing ages have different needs, such as educational funding, elder care for parents, retirement readiness, etc.
Likewise, the delivery system can and should be varied. It may include lunch-and-learn presentations, online tools, smart phone apps, and individual meetings with a certified financial planner. The comprehensive approach that may be obtained from professional educators might be the best option, since they’ve perfected the message and tools and aren’t trying to “sell” products or insurance to employees.
Financial wellness programs can boost employee morale; reduce absenteeism and retirement plan loans; and serve as a tool for recruitment and retention, say operators of wellness programs. SHRM estimates that employers can save up to $3 for every dollar invested in such a program. These programs may also lead to less physical illness due to employees’ lower stress levels and could also result in higher worker productivity.
With the significant upside arguments in favor of employee financial wellness programs, maybe it’s time for more employers to explore adopting a financial wellness plan for their employees.