Looking to make a lasting legacy? Financial well-being is more important than ever, and encouraging employee financial wellness is one of the most effective methods for businesses to get one step closer to an incredible (and lasting) work culture. In general, employees concentrate better, contribute more productively, and ultimately aid the business in achieving its objectives when they are well-financially-educated and financially stable. Let’s take a moment to examine the advantages of financial wellness for employees and offer some actionable measures that businesses can use to encourage financial knowledge among your workforce.
The importance of employee financial wellness
Unfortunately, many workers today face financial stress, which frequently results in lower job satisfaction, higher absenteeism, and decreased productivity. A PwC survey revealed that 63% of workers say they are under more financial stress now than they were before the pandemic began, and 45% of those under stress claim that their concerns about money keeps them from focusing on their jobs.
Employee financial wellness refers to the overall financial health of an employee, including their ability to manage expenses, save for the future, and handle financial emergencies without undue stress. You may not be in direct control of giving all your employees raises tomorrow, but there’s some good news! Encouraging employees' financial wellbeing programs involves more than simply paying them more; you can go above and beyond by giving them the knowledge and tools they need to make wise financial decisions.
Benefits of promoting employee financial wellness
- Increased productivity: Financial stress can be a major cause of distraction. Concentration at work could decline if employees are stressed about managing their debt, paying their bills, or even just saving enough for retirement. Companies that invest in employee financial wellness programs can help alleviate these concerns, leading to more engaged and productive employees. A survey conducted by the International Foundation of Employee Benefit Plans reports that 53% of employers saw an increase in employee engagement and satisfaction after implementing financial wellness initiatives.
- Improved employee retention: Long-term retention is higher among employees who perceive their employer to be supportive in all facets of their lives, including their financial security! Offering financial wellness employee benefits can improve job satisfaction and loyalty, reducing turnover rates and the associated costs of recruiting and training new staff.
- Better health and well-being: We’ve used the word ‘wellness’ a lot in this article already, but mental and physical health problems are highly associated with financial stress. Anxiety, sadness, and other stress-related disorders are more common in employees who have financial challenges. By promoting financial wellness, companies can contribute to the overall well-being of their employees, leading to lower healthcare costs and healthier employees.
- Enhanced company reputation: Companies that put employee well-being first stand out as desirable spaces to work in today's competitive employment market. Providing comprehensive financial wellness programs can improve a business's standing, which helps you draw in (and retain!) top talent and develop a strong employer brand.
- Empowerment to build a legacy: Employees that are financially secure are better able to leave a lasting legacy for their family and themselves. Companies can play a critical role in assisting employees in reaching their long-term objectives including homeownership, a secure retirement, and education for their children by offering the instruments and resources for financial wellness.
Actionable ways to promote employee financial wellness
You know why you want to offer financial wellness, so now let's look at some actionable measures that businesses may use to support their employees.
Implement employee financial wellness programs
This is admittedly a broad category, but providing comprehensive employee financial wellness programming is one of the best methods to encourage overall financial wellbeing. A range of products and services, including retirement planning, debt management support, budgeting tools, and financial planning, can be included in these programs, but you should aim to customize these for your company goals and employee demographics.
Whether a worker is nearing retirement age or is just beginning their career, these programs can be customized to match their specific needs.
Review and adjust pay structures
It might seem obvious, but a vital component of financial wellness is making sure employees are paid fairly and competitively, even though financial wellbeing encompasses more than just compensation. Pay structures should be reviewed by companies on a regular basis to make sure they reflect the cost of living and are in line with industry norms.
Offering profit-sharing plans, performance-based bonuses, and other financial incentives may encourage workers and give them more financial stability. These bonuses not only honor diligence but also motivate employees to support the growth of the business.
Offer financial literacy training
The ultimate secret to financial wellness is education. Paying someone the correct amount of money is a great start, but providing financial literacy training means employers can enable their teams to make well-informed financial decisions in their personal lives. Don’t assume all of your employees have the same financial baseline. Understanding credit, investing, budgeting, and retirement savings are some of the things that can be covered in this training.
Online courses, webinars, and workshops serve as effective methods for delivering this type of instruction. Companies might collaborate with consultants or financial institutions to offer expert-led courses, no matter what medium the delivery ends up being. Employees who receive financial education are more likely to save for emergencies and participate in retirement programs, according to a report by the FINRA Investor Education Foundation.
Provide access to financial tools and resources
Companies can give employees access to a range of financial tools and information in addition to official financial wellness programs. Investment platforms, retirement calculators, and budgeting apps are a few examples of this.
Employers such as Google and IBM, for instance, provide their staff members with access to financial wellness platforms that include tools for budgeting, investing guidance, and customized financial planning. These resources assist employees manage their money and achieve their financial objectives.
Create a culture of financial well-being
Encouraging financial wellness ought to be integrated into a larger corporate culture that prioritizes and encourages worker wellbeing. This involves fostering an atmosphere of open communication where employees can discuss financial issues and request for assistance.
Being transparent about the value of financial wellness and encouraging employees to utilize the available resources means leadership will need to play a critical role, driving culture shift from the top.
Incorporate financial wellness into employee benefits packages
Employee benefits packages that currently exist can easily incorporate financial wellness benefits! This can include providing emergency savings funds, matching payments to retirement accounts, or help with student debt repayment.
For example, several businesses now provide benefits such as student loan repayment plans, in which the company makes a payment toward the employee's educational debt. For workers who are saddled with seemingly impossible to pay down student loan debt, this can be a huge relief and expedite their path to financial stability.
Incentivize participation in financial wellness programs
Providing incentives for participation in financial wellness programs also boosts employee engagement. Incentives and recognition to staff members who finish financial planning sessions, attend financial workshops, or meet personal financial objectives is just one way to accomplish this.
Incentives highlight the company's dedication to the well-being of its employees while simultaneously increasing engagement. Employees who take part in financial wellness programs are more likely to report gains in their financial health, such as lower debt and more savings, according to a Financial Finesse poll.
Next steps for success
Employers may help their employees become more financially secure and build a lasting legacy by implementing these strategies into practice. Consequently, companies will benefit from having a workforce that is more committed, effective, and devoted. Remember, promoting employee financial wellness programs aren’t just a perk — they’re a vital part of building a successful and sustainable company.
We recognize that one of the most important ways to leave a lasting legacy is to support employee financial wellness. Our training and consulting services are intended to assist businesses in developing successful employee financial wellness programs that cater to the particular requirements of their workforce. By partnering with us, you can empower your employees to achieve financial security and focus on what truly matters — contributing to the success of your organization.
Get in touch with PowerToFly today to find out more about how we can assist you in putting in place financial wellness programs that will benefit your employees as well as your business. Let's create a successful and prosperous financial legacy together!
