According to a new survey from the National Endowment for Financial Education, 88% of Americans say the COVID-19 crisis is causing stress on their financial wellbeing. Even before the pandemic, worrying about financial matters was the top cause of stress in the workplace.
Employers are in a unique position to offer employees assistance in addressing and improving their financial health. And many employees have grown to expect it. According to the Employee Benefit Research Institute’s latest Retirement Confidence Survey, 25% of workers say they rely on their employer for retirement planning information. Four out of five say they’d like help with how to calculate what they need to save for retirement.
By addressing employees’ financial wellbeing, you show them that you care and that they can trust you to guide them in the right direction. And with less stress, they’re more productive, less distracted, and happier with their jobs.
As an employer, how can you assure positive financial wellbeing among your staff? Here are three important ways.
1. Offer Workplace Saving & Defined Contribution Options
Approximately 38 million private-sector employees in the U.S. don’t have access to a retirement savings plan through their employer. While many businesses don’t offer 401(k) or other retirement plans because of cost, administration, and compliance concerns, there are reasons why that could be a mistake.
These days, most full-time employees seek some sort of contribution plan. If you want to hire and keep the best workers, you need to offer competitive benefits. Additionally, when employees are given easier access to save for their financial wellbeing, they’re more likely to do so. This leads to employees feeling better about retirement with less stress and worry.
2. Identify At-Risk Employees
Use available data to determine employees that may need assistance. For example, if you have a retirement savings program, identify those that aren’t participating. Other indicators could be wage garnishments as well as loans and hardship withdrawals from 401(k) plans. When you know who’s struggling and how many there are, you can put a plan in place to help them address their problems. Privacy and discretion are important in these kinds of situations, so don’t call out individuals in a group or public setting.
This leads us to perhaps the most important tool to address financial wellbeing…
3. Include Financial Health in an Integrated Health Management Plan
Employees have diverse financial needs. While some may be looking to save for big life events like buying a home or planning for retirement, others may be struggling just to make ends meet. But what’s important to recognize is that financial wellbeing is a part of each person’s greater overall health. No matter their financial status, most workers faced with financial decisions often feel stress and anxiety. You must address not only the financial matters but any other things that may affect the employee.
A few benefits of a financial wellbeing program include:
- Financial security: When employees get helpful, unbiased guidance, they can take meaningful steps to achieve financial security.
- Increased productivity: With less financial worries, employees will be less distracted and more focused on their jobs.
- Better physical health and mental health: High financial stress can increase the likelihood of acute illness, high blood pressure, and other physical health problems. Less financial stress can also lead to overall better mental health.
- Improved employee engagement: Happy employees are more engaged and more loyal to their employers.
As an important component of the WellOnMyWay integrated health management solution, we offer a robust financial wellbeing program that teaches employees how to maximize their income and plan for the future. Employees can take advantage of financial health resources, education, and 1:1 guidance, empowering them to do more with their money and achieve financial security. And if they’re experiencing stress and anxiety, we can guide them toward mental and emotional health resources and assistance too!