Are your employees worried about money? Most likely, many of them are. According to the Federal Reserve’s Report of the Economic Well-Being of U.S. Households in 2015, a whopping 76 million Americans struggle with their finances. Many employers are responding by taking steps to promote financial wellness.
Why Should Employers Promote Financial Wellness?
Employers already provide a paycheck and benefits, so they may wonder why they should do anything else. There are two main reasons.
Student loan and credit card debt plague many Americans. Even among those with less debt, living paycheck-to-paycheck is common, and many Americans lack adequate emergency funds or retirement savings. It’s not hard to see how this can lead to high levels of stress and sleepless nights.
This is not good for employers.
If employees are stressed, they will have a harder time focusing on their work. If they can’t sleep, their health will decline – again, a detriment to their quality of work.
Happy employees are productive employees. This is the first reason employers should care about financial wellness.
The second reason has to do with employee retention. Employees who are worried about their finances are more likely to pursue other job opportunities. They may also decide that they need to move to save money, whether it’s to live in their parents’ basement or just to transfer to a cheaper city. On the other hand, employees are much more likely to stick around if they feel that their finances are on track and that their employer is invested in this.
How Can Employers Promote Financial Wellness?
Employers can take several steps to help improve the financial wellness of their employees.
- Offer benefits that empower financial wellness. In addition to standard benefits, like health insurance and retirement plans, employers should consider other optional benefits that fit the needs of their employees. Long-term care insurance and disability insurance are common options, but younger employees may be more interested in student loan repayment benefit. Benefits that will help employees pay for their children’s college expenses could also be popular. Credit monitoring is another benefit that could come in handy, especially considering all the recent concerns over data breaches and identity theft.
- Educate employees on their benefits. Benefits won’t actually benefit anyone if employees don’t know about them. Make sure employees are aware of their benefit options and enroll in the ones they want. Then help employees take advantage of these benefits. For example, remind them to use their FSA funds before they expire and to contribute to their 401(k) plans.
- Offer educational opportunities. Benefits are important, but they may not be enough. Employees also need to learn the right skills and habits to manage their finances successfully. Employers can help by arranging for expert lessons. There are many possible topics, including mortgage management, debt reduction, retirement planning and student loan repayment. The lessons could be held as lunch hour seminars or as flexible webinars.
As always, Heffernan is here to help. Contact us if you’d like to explore your options.