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For Retention, Reducing Financial Stress is Key

For Retention, Reducing Financial Stress is Key

by | Sep 15, 2021 | Blog

For retention, reducing financial stress is key. Financial stress is a major but often overlooked factor to employee turnover. So, financial wellness initiatives can be invaluable retention tools.

Turnover is a major problem for employers — and it’s getting worse. In June alone, 3.9 million U.S. workers quit their jobs. More alarming, 65 percent of employees surveyed by PwC in August of 2021 stated they were looking for a new job. 

In addition to the challenges of losing top talent, turnover is highly disruptive due to the time and money it takes to train new hires. The Society for Human Resource Management (SHRM) estimates that the average replacement cost of a salaried employee is six to nine months’ salary. That means that an employee earning $60,000 per year costs around $30,000 to $45,000 to replace. 

So, how can you increase employee retention? One answer is financial wellness.

What is employee financial wellness?

Stress is a top reason employees leave their jobs, according to recent research by iHire, and financial stress is an under-recognized part of that picture. So, putting your efforts towards reducing financial stress can help keep people on at your company longer. Per the American Psychological Association’s 2020 Stress in America report, 63 percent of adults say their finances are a significant source of stress, a major jump from the previous year, when just 46 percent said the same. 

The COVID-19 pandemic has increased financial stress — 62 percent of those in households that experienced job or wage loss since the outbreak began told Pew Research Center that the economic impact of the pandemic will make it harder for them to achieve their financial goals. COVID’s ongoing impact on the economy and the world at large make it all the more important to start thinking about how your company can commit to employees’ financial wellness now. 

Incorporating financial wellness into employee benefits’ packages is not only desired — 87% of employees want help when it comes to personal finance, according to PwC — but also a proven solution. Financial wellness programs improve overall health and well-being, leading to lower stress and lower healthcare costs. Plus, employees say it keeps them sharper at work: 6 in 10 say they are more committed to their employer and more productive when employers demonstrate a commitment to their financial wellness, Prudential found last year.

Finding financial wellness solutions that work

According to research conducted by FinFit between 2018 and 2020, when organizations offered financial wellness assistance, there was a nearly 20 percent increase in employee retention across salaried and hourly employees, $1,855 annual turnover cost-savings per employee and nearly $2 million saved annually for every 1,000 employees. 

When it comes to actually implementing financial wellness benefits for your employees, programs like Best Money Moves can help. Best Money Moves uses artificial intelligence to power a mobile-first platform that measures employee financial stress, then dials it down with a unique content-mapping system that helps solve your employees’ pain points.

Our triggers and alerts system, as well as budgeting tools, personal finance resources and more, guide employees to make smarter financial decisions and reduce their overall stress, which in turn, can help improve your company’s retention rates.

If you want to learn more about how Best Money Moves can bring financial wellness to your company, download our whitepapers.

Is Your Employee Doing Side Work?

Is Your Employee Doing Side Work?

by | Sep 25, 2019 | Blog

Is your employee doing side work? Employees work side hustles to earn extra income in their off-time and these are the types of side jobs they’re taking on.

Is Your Employee Doing Side Work?

It’s called a “side hustle.” And, the latest research shows about one-third of U.S. employees, approximately 57 million people, are working side hustles to earn extra income. 

Should traditional employers be concerned about an employee doing side work, also known as “moonlighting?” Maybe, and for a variety of reasons. Perhaps the most important: More than 80 percent of Americans who currently have a side hustle are interested in doing it full-time, according to a recent SunTrust survey. 

Are your employees doing side work? If so, what job(s) are they doing and how much are they making? 

What Work Is Your Employee Doing On the Side?

AppJobs recently analyzed applications for side gigs to determine what the most popular side hustles are and how much they pay. The most popular side hustles are jobs that don’t necessarily require previous work experience, particular skills, or a degree, but still pay fairly well. Here are the top five most popular side gig categories according to the data gathered by Appjobs:

  1. Delivery (105,314 applications) pays an average rate of $17.10 per hour
  2. Freelance (95,866 applications) pays an average rate of $25.33 per hour
  3. Petsitting (21,620 applications) pays an average rate of $13.17 per hour
  4. Cleaning (14,143 applications) pays an average rate of $11.29 per hour
  5. Driving (11,199 applications) pays an average rate of $14.36 per hour

“Hundreds — maybe thousands — of companies are making it easy for Americans to make extra money,” says Kathy Kristof, an award-winning journalist and editor of $idehusl, a website that reviews and rates online platforms that offer ways for people to make money on the side.  “We’ve researched, rated and reviewed more than 300 of these online platforms. Where Uber and Lyft get miserable scores with our formula, there are probably 100 platforms that provide engaging, well-paid opportunities that could provide $500 to $2,500 per month in additional income. These opportunities involve teaching, cooking, creating tours, writing, programming and renting out everything from your carpet cleaner to your swimming pool.”  

Which Generation Makes the Most Money from Side Work?

The SunTrust survey looked at how much individuals in each generation demographic make working a side hustle and found:

  1. Millennials make an average of $10,972 from working a side hustle each year
  2. Gen Xers make an average of $8,791 from side work each year
  3. Baby Boomers make an average of $5,892 from side work  each year

“Millennials often take on side hustles because they’re not earning enough to pay off their student debt and still have a life. Baby Boomers, who are retiring (or near retiring), are in the market because they feel like they’re not quite financially stable enough to leave the working world without some other way to make money,” says Kristof.

Should Employers Worry About an Employee Doing Side Work?

“Smart side hustlers are using their extra income to pay off debts and boost savings. That makes them a bit more confident about their ability to withstand a job loss. So, if their bosses are mean and miserable, they’re in a better position to walk away,” says Kristof. 

“That said, what side hustles don’t give you are employee benefits and a work community. If an employer has a great benefits package and a positive, supportive working environment, most people won’t leave that — even if they have a side hustle.”

If you do notice a spike in your turnover rate, however, Kristof advises, “Ask yourself: How is my company faring in this changing workforce? Are we a place where people want to work, or are we just a place to collect a paycheck?”

“If you are nothing but a paycheck, you should worry — or, better, change. Ask yourself if you have tools in place to encourage your best workers to thrive. Are you talking to your workers? Do you know what they want/like/need from you? Are you listening? The freelance economy is bringing a sea change in the workforce. Those who are smart enough to adapt are likely to thrive.”

More On Employees and Management Strategies

Office Dress Code Policies in Today’s Workplace

Top 10 Workplace Etiquette Rules for Communication

Building Office Culture with Diversity and Inclusion

Hiring Trends to Watch in 2020

Why You Need to Train Employees for Future Tech

Top 10 Employee Benefits for 2020

2 Simple Strategies to Improve Office Culture

Is Rehiring a Former Employee a Good Idea?

How to Improve Gender Diversity in the Workplace

How to Make Traditional Work Better for Freelancers

Employee Turnover: This is Why Your Employees Quit

Employee Turnover: This is Why Your Employees Quit

by | Feb 22, 2017 | Blog

In this week’s Best Money Moves roundup, we take a look at news stories and new research studies that may impact employee benefits and HR issues. We hope you find this news roundup helpful, and we’d love your feedback.

Why do employees quit? Employee turnover is costly for employers, so jobs site Glassdoor studied 5,000 job transitions to figure out what makes an employee more likely to head for the door. The study found that employers with high overall company ratings and high ratings for workplace culture and values have better employee retention rates.

According to the study, employees were less likely to quit if they’d received a raise, but were more likely to quit if they’d been stuck with the same job title for too long and were unable to advance within the company.

What can your company do to keep top talent from looking for other opportunities? Read the rest of Glassdoor’s findings.

How does your company handle mental health in the workplace? A recent study by the International Foundation of Employee Benefit Plans found that about a quarter of employers are unsure if their employees are impacted by substance abuse or mental health issues. Learn what you can do to help struggling workers.

Do you have a “work spouse?” Having a platonic “work wife” or “work husband” in the office to confide in and offer moral support can help boost job satisfaction. Here’s why 70 percent of office workers have a work spouse.

Why are employees struggling to pay their bills and save for the future? Almost half of Americans say they don’t have any money to save after taking care of their expenses. Here’s how employers can help.

Recent surveys found that employees are engaged with their work about 30 to 35 percent of the time. That means that your employees are disengaged for up to 70 percent of their day. Here’s how to wake up your office culture and increase engagement.

Which workplace stressors are impacting your employees? According to a new CareerCast survey, deadline pressure is the biggest cause of workplace stress. See the other 10 top stressors.

Many non-profit organizations struggle to compete with for-profit companies when recruiting new employees. While they can’t often compete on salary offerings, they can leverage Millennials’ desire to see their work having a positive social impact.

Small steps on the company level can keep your employees healthy. From offering flexible hours so employees can fit in a trip to the gym to having walking meetings, these low-cost benefits can have big health payoffs.

Gone are the days when employees had to work 40 hours per week to be included in company benefits plans. A growing number of employers are offering full benefits to part-timers to encourage loyalty and reduce job-hopping.

As more of the Baby Boomer generation hits retirement age, retirement programs worldwide are struggling to keep up. According to the Bloomberg Sunset Index, there’s now a smaller ratio of younger workers supporting the world’s retirees. Here’s how pension funds and other programs are coping.

Have something to add? Email info@bestmoneymoves.com.

It’s hard to stay on top of everything in the news. That’s why each week our Best Money Moves newsroom will bring you the most important news in financial wellness, employee benefits and financial stress. We hope you like the information and, if you do, please spread the word. For midweek developments, follow us on Twitter and on Facebook.

How Will Trumpcare Change Your Employee Benefits Package?

How Will Trumpcare Change Your Employee Benefits Package?

by | Jan 25, 2017 | Blog

In this week’s Best Money Moves roundup, we take a look at news stories and new research studies that may impact employee benefits and HR issues. We hope you find this news roundup helpful, and we’d love your feedback.

President Trump has been clear about his plans to repeal the Affordable Care Act – otherwise known as Obamacare – and replace it. But what will Trumpcare look like and what will it mean for the thousands of American businesses who provide healthcare benefits to their employees?

Trump has been vague so far about what his plan would entail and how it would differ from current healthcare industry regulations. This means employers can’t plan ahead for any changes the administration may put into place which would affect their employee benefit offerings.

On his first day in office, Trump made his first move to weaken Obamacare by signing an executive order for government agencies to “waive, defer, grant exemptions from, or delay the implementation of” any part of the law that imposes a financial burden on government.

Here are five ways Trump’s healthcare policies could impact the employee benefits industry.

New year, same financial problems. Many Americans resolved to get their finances in order in 2017, but three-quarters still report feeling financially stressed, according to Center for Retirement Research at Boston College. Other studies show more than one in four Americans feel threatened by debt collectors. Learn how severe the problem is for your employees.

A federal judge ruled Monday that healthcare giant Aetna lied last year when the company said its decision to pull out of the Obamacare exchanges was strictly a business decision. Judge John D. Bates wrote in his ruling that the move was a ploy to dissuade the Department of Justice from filing suit to block Aetna’s controversial merger with Humana. That merger – which would reduce competition among health insurance providers in many areas – is now in trouble.

It also signaled a possible problem with the Anthem/Cigna merger, which is under review by a different judge.

Do you know how all of the fees on your credit cards work? If not, you’re not alone. About 50 percent of Americans don’t understand everything in their credit card agreements, and that can lead to financial stress that spills over into the workplace.

What in the world is a “bleisure trip”? Also known as a “bizcation” or “workcation,” these are business trips that also include some personal time, as opposed to vacations where employees spend time checking email or finishing assignments that didn’t get done during regular working hours. Encouraging bleisure trips may help employees avoid burnout, especially if they’re otherwise reluctant to take a vacation.

While many companies think a fridge full of snacks and a few bean bag chairs will attract Millennial employees, that may be changing. The oldest Millennials are settling down, getting married and having children, which means they’re becoming more interested in their healthcare coverage and life insurance than healthy snacks and lunchtime foosball tournaments. Here’s how you can rework your company’s benefits package to fit these changing needs.

How expensive is employee turnover? According to a recent survey from Quinlan & Associates, some banks are incurring turnover costs of up to $1 billion per year as employees walk out the door. What can they do to stem the tide of leaving talent?

Some employers offer student loan repayment as an employee benefit, while others help students avoid debt in the first place. Companies including Starbucks and Chipotle are teaming up with colleges to help their employees earn a degree without racking up insurmountable student debt burdens. Learn how these programs could help your workforce.

A recent study found that 95 percent of HR executives think burnout is the biggest thing hurting employee retention, so 2017 is all about improving employees’ experiences at work. Here are four management trends we’ll see this year in the fight against burnout.

Corporate wellness programs are shifting focus from physical to mental health with things like financial stress management and mindfulness taking top priority. Read more about the top 10 corporate wellness trends for 2017.

Have something to add? Email info@bestmoneymoves.com.

It’s hard to stay on top of everything in the news. That’s why each week our Best Money Moves newsroom will bring you the most important news in financial wellness, employee benefits and financial stress. We hope you like the information and, if you do, please spread the word. For midweek developments, follow us on Twitter and on Facebook.