Benefits Administration, EZ HR, Financial Wellness

What Do You Know About Financial Wellness?

There’s nothing new about the concept of Employee Wellness programs. I think we can all agree that healthy employees are going to support a healthy company, and a healthy bottom line. However, have you considered the importance of your employees’ financial health and well-being? A recent survey by MarketWatch stated that 65% of Americans say that their personal finances are their biggest source of stress.

A similar report by CBS News  states that roughly one-third of U.S. workers say they’re living paycheck to paycheck and have nearly no money for savings after paying their monthly bills.

Short of giving everyone in the company massive raises and bonuses to alleviate their financial woes (wouldn’t that be nice for everyone?), what can employers do to help their employees who are struggling with financial commitments, student loans, medical expenses, higher grocery bills, and everything else that comes along with their current financial outlook?

There’s actually quite a bit a company can do to support their employees, and most of it involves educating them to better help themselves:

Companies can support their employees’ financial wellness through a variety of strategies and programs that address different aspects of financial health. Here are effective ways to help employees with their financial wellness:

1). Offer Financial Education and Resources

• Workshops and Seminars: Provide educational sessions on budgeting, saving, investing, debt management, and retirement planning. Companies can often leverage their financial partners to help with this education.
  • Banks and Credit Unions: Many financial institutions offer financial wellness programs as part of their corporate services. These programs might include workshops, financial planning resources, and access to financial advisors.
  • Investment Firms: Some investment firms provide educational resources and seminars on topics like retirement planning, investment strategies, and savings.
  • Community-Based Programs: Nonprofits focused on financial education and literacy may offer programs and resources to employers, including workshops, educational materials, and one-on-one counseling.
  • Financial Literacy Organizations: Organizations dedicated to promoting financial literacy often collaborate with employers to provide tailored financial wellness programs.
• Online Resources: Make available a range of online tools and resources, such as budgeting calculators, financial planning guides, and educational articles. These don’t have to be purchased products. Employers can often simply identify what tools are available online for free and educate their employees on how to use them.
• Training Programs: Include financial literacy training as part of onboarding and ongoing employee development programs.
• Educational Materials: Distribute newsletters, guides, and other materials that provide financial tips and information.

2). Provide Access to Financial Counseling

• One-on-One Counseling: Offer access to certified financial planners or counselors who can provide personalized advice and support.
• Employee Assistance Programs (EAPs): Many EAPs include financial wellness as part of their suite of services. They often provide access to financial counseling, budgeting tools, and other resources designed to support employees’ financial health.
• Debt Management Assistance: Provide resources or referrals for employees struggling with debt, including credit counseling and debt consolidation services.

3). Support Retirement Planning

• Retirement Plans: Offer and communicate the benefits of retirement savings plans, such as 401(k) or pension plans, and ensure they are well-structured and competitive.
• Employer Matching: Provide matching contributions to retirement savings plans to incentivize employees to save more for retirement.

4). Encourage Savings and Emergency Funds

• Automatic Savings Programs: Implement programs that automatically transfer a portion of an employee’s paycheck into a savings account or emergency fund. Of course, you’ll need the employee’s permission to do so or offer them an easy way to opt out. Also, you can consider offering incentives to employees who set up or contribute to emergency savings accounts.
• Goal Setting: Encourage employees to set financial goals and provide tools or support to help them achieve these goals.

5). Enhance Compensation and Benefits Packages

• Competitive Salaries: While giving everyone big raises may not be the solution, companies should ensure that compensation packages are competitive and fair, providing a foundation for financial stability.
• Comprehensive Benefits: Offer a range of benefits, including health insurance, disability insurance, and other financial protections that contribute to overall financial security.

6). Offer Flexible Financial Solutions

• Emergency Loans: Provide access to emergency loans or financial assistance programs for employees facing unexpected financial hardships. This might be through a program funded by the organization or through a banking partner that works with your employees.
• Flexible Spending Accounts: Offer flexible spending accounts (FSAs) or health savings accounts (HSAs) to help employees manage medical expenses with pre-tax dollars.

7). Integrate Financial Wellness with Employee Benefits

• Holistic Approach: Ensure that financial wellness programs are integrated with other employee benefits, such as mental health support and work-life balance initiatives, to address the overall well-being of employees.

By implementing these strategies, companies can effectively support their employees’ financial wellness, leading to increased job satisfaction, improved productivity, and a more engaged and loyal workforce. Financially healthy employees are also better equipped to handle changes and challenges, both in their personal lives and in the workplace. This adaptability can lead to better performance during organizational changes or economic downturns.

HR Affiliates can help you with training and with competitive compensation plans to ensure that you have a healthy financial philosophy to reward your employees. We also have several trusted partners in the community that can provide targeted educational resources for your employees. Let us know how we can help you help your greatest investment. We make it EZ’er.

September 19, 2024

Paula Agee, SPHR, SHRM-CP, VP of Human Resources and Chief  People Officer