Did you know that the personal savings rate in the US is half of what it was 50 years ago—or that nearly 7 out of 10 Americans have less than $1,000 in a savings account?
No wonder financial concerns are on the rise. In fact, over half of US employees feel anxiety about their finances, according to a 2017 survey by PricewaterhouseCooper (PwC).
Workers are most worried about not having enough emergency savings, not being able to retire when they want to, not being able to meet monthly expenses or keep up with other debts, and being laid off from work, according to PwC.
Stress about finances can take a toll on physical and emotional well-being, and distract from work responsibilities. Workers stressed about financial problems are more likely to take time off to deal with them—and to spend at least three working hours each week to address them.
That’s why financial health is an important part of employee wellness, and a key component of a healthy business. So if you’re taking steps to improve the overall wellness of your workers, consider including a workplace financial wellness program as part of that strategy.
What Is Workplace Financial Wellness?
Financial wellness has benefits for both employers and employees. For employers, it might be a set of programs designed to improve employee financial understanding, behavior, and outcome, while also driving business impact.
For employees, the term is defined by overall financial health and stability, rather than simply wealth. It’s the ability to balance the mental, emotional, and physical aspects of money in a way that prepares an employee for financial challenges.
Financial wellness is a combination of knowledge, habits, and goals, all of which can be nurtured and developed through a workplace financial wellness program.
How Financial Wellness Programs Can Give Your Workplace a Boost
Workplace financial wellness programs educate employees about overcoming personal finance challenges, such as reducing debt, managing assets, contributing to 401k accounts, developing an emergency savings account, and setting money aside for future needs like a home purchase or retirement.
Financial wellness programs might include:
- Lunch-and-learn sessions
- Confidential one-on-one mentoring
- Support groups based on financial goals (such as home ownership or reducing student loan debt)
Financial wellness programs have been shown to drive engagement, productivity, and success by as much as $400 per employee—or an ROI of up to 3 to 1.
Corporations across the country are beginning to catch on, with over 90 percent of large employers in the US planning to implement or expand some type of financial wellness program, according to a Merrill Lynch report.
Financial wellness programs are linked to:
- Higher worker productivity.
- Reduced distraction on the job.
- Reduced absenteeism on the job.
- Reduced healthcare costs.
- Increased employee morale.
- Improved employee financial well-being.
Money concerns for US workers don’t seem to be going away on their own. That’s why a little proactive involvement on the part of employers can go a long way.