Top 3 Ways to Create a Culture of Financial Wellness

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Financial health is an important part of overall employee wellness. And there’s never been a better time to take a look at whether your business creates a culture of financial wellness.

More than one in four employees report that issues with personal finances have been a distraction at work, according to a 2016 survey by PricewaterhouseCooper (PwC). And money concerns for US workers don’t appear to be going away on their own. In fact, nearly half of all employees surveyed by PwC said their financial worries have worsened over the last year.

So if you’re taking steps to improve the overall wellness of your workers, consider including financial education as part of that strategy. Doing so can help drive engagement, productivity, and success, and increase employee loyalty and connection.

Here are three key ways you can begin building a workplace culture that fosters financial wellness.

1. Offer a Financial Wellness Program

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.

Through lunch-and-learn seminars, webinars, workshops, and counseling, these programs have the potential to transform how people manage personal finances.

Financial wellness programs are usually offered through an outside resource who can give unbiased advice on money management and provide a safe, confidential environment for employees to discuss personal financial issues and stresses. They should be provided at no cost to employees.

A good workplace financial wellness program should give employees:

  • Financial education and guidance.
  • Information about investing.
  • A better understanding of and ability to manage personal finances.
  • A plan to get out of debt and avoid bankruptcy.
  • The ability to create and stick to a budget and savings plan.
  • A plan for medical and healthcare spending.
  • Insight into how to use a retirement plan.

 

2. Help Employees Make Informed Decisions About Company Benefits

Health care and disability plan options can be confusing for employees, who might be inclined to select plans based simply on premium prices if plan information is difficult to navigate. Consider helping employees see beyond premiums when choosing a health plan, and educating them about how short-term and long-term disability programs can help protect against the loss of their income.

Even a simple lunchtime workshop or talk can help employees navigate their options and feel more supported. As a result, they’ll likely feel less stressed in the short term, and be in a better position to make the best choices for their long-term financial future.

3. Provide Tools for Retirement Planning and Saving

A good retirement savings plan is a key part of financial wellness for both employers and employees. In fact, employees are 15 percent more likely to save money for a retirement with an employer-sponsored 401k program. And over half of US states require or are in the process of requiring employers to offer some sort of payroll-deducted savings plan.

But if employees don’t know how to create a budget, they often don’t understand how to manage and diversify their 401k accounts, or how to deal with risk and volatility. That’s why employers are also beginning to incorporate employee 401k education into their financial wellness programs.

Employers are offering tools to help workers understand how much they’re likely to need in order to retire—and how this translates into day-to-day savings. Financial wellness programs can help employees understand that making even small changes, such as increasing contributions by two percent, can impact their long-term savings outlook.

Along with a few educational tools, a 401k plan can pay off big time.

Benefits of 401k plans:

  • Help small businesses attract and retain better talent.
  • Aid in reducing employee turnover.
  • Are a great tax benefit – for both business and personal funds.
  • Help small business owners prepare for their own retirement
  • Give people the ability to retire comfortably and contribute to the economy.

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