Financial wellness has become table stakes for employers. But while many employers believe they’ve ticked the financial wellness box by providing employees with a 401(k) and retirement planning advice, that’s only a tiny piece of the help employees need.
That’s not to say comprehensive retirement planning isn’t vital to your employees’ overall financial wellness. It is. But if your employees are typical, they likely struggle with paying down debt, significant medical expenses or other financial hardships, which means they may not always have the option to set aside funds for retirement. Their financial stress goes beyond wondering whether they have, or they can, save enough for retirement.
What percentage of employees struggle with other causes of financial stress? Plenty. Forty-nine percent of employees say that if their workplace benefits included financial planning programs in addition to existing retirement savings assistance, their productivity in the workplace would significantly increase, according to the 2017 Retirement Confidence Survey conducted by the Employee Benefits Research Institute.
In addition to allowing auto-deductions for retirement savings, best practice financial wellness programs offer a wide range of preventative and curative options for your employees’ financial stress, with both long and short-term solutions for tackling tough financial issues such as debt, elder care, identity theft and more.
Other studies have concluded that financially secure employees are more motivated and focused at work. In order to help your team reach this level of financial wellness, consider providing a financial wellness program that offers a broad range of services, including:
- An easy-to-use budgeting system
There’s nothing like seeing whether you’re cash-flow positive (or not). Seeing a clear view of your income and expenses along with an evaluation of your spending habits helps employees take a long hard look at the choices they’re making today and how they can make different choices going forward. Simple, yet effective tools that help employees identify the root causes of their financial stress can help eliminate financial insecurity and increase overall financial wellness.
- Resources for managing debt
More than half of the workforce is financially stressed, according to a PwC study on financial wellness. And, among millennial employees that number rises to 64 percent. Debt is a big driver of financial insecurity and figuring how to pay down or manage debt can be incredibly tricky, especially if employees have multiple types of debt, with more than one creditor. When choosing a financial wellness platform, pick one that assists employees with calculating the total sum of what they owe while also tracking interest rates and repayment habits. Understanding what is owed helps employees recognize how much their existing debt will cost them in the long run and what their best options are for consolidation and repayment.
- Help to set savings goals
You can’t reach a goal if you don’t set one. Financial wellness programs should allow employees to set individualized goals, based on personal circumstances regarding income, lifestyle, basic expenses, individual interests and family size. A qualified financial wellness program should offer assistance with assigning realistic time frames to accomplish each financial goal. The ability to visually track personalized savings timelines encourages commitment to the savings plan and ongoing smart spending habits.
- Comprehensive, personalized answers to individual concerns or questions
Financial wellness isn’t just about creating a tight budget, or just about reducing debt. Financial wellness is integrated with all areas of life. Whether directly associated with financial planning or not, financial wellness deeply impacts an employee’s sense of overall well-being. All of life’s big decisions and events carry lasting effects on an employee’s bank account and overall financial wellness. Ensure that you provide a comprehensive financial wellness provider that can address – and resolve – your employee’s individual financial stressors.
Your employees are most likely experiencing financial stress. While retirement planning benefits are important, they don’t come close to capturing the full needs of your workforce. Provide your employees with access to a financial wellness platform that addresses their own financial stressors, not someone else’s.
Don’t forget: when your workforce is less financially-stressed and more financially-stable, it’s better for everyone.