Financial Wellness Programs Boost Employee Happiness

Since the pandemic, many Americans have been struggling to get their financial houses in order.

What is a  Financial Wellness Program?

A financial wellness program is an employee benefit program offered by some employers to help employees improve their financial health, knowledge, and behaviors. Some key things to know about financial wellness programs:

• They aim to provide employees with education, tools, and resources related to budgeting, debt management, saving, investing, and more personal finance topics. The goal is to help employees make informed financial decisions and take actions to improve their financial situations.

• As part of the program employeers may offer workshops, seminars, one-on-one financial counseling, access to financial planning software, educational materials, and other services. Some bring in financial experts to advise employees.

• They can cover topics like how to manage student loan or credit card debt, save for retirement, understand investment options, and balance monthly budgets. The aim is to equip employees with knowledge and skills.

• Some companies offer these programs as a free benefit to employees. Others give employees access to financial advisors and resources at a discounted rate.

• The goal is to reduce employees' financial stress and help them gain more financial security. This can make them more productive at work and improve recruitment and retention.

What are the benefits to the employee?

There are several key benefits for employees who participate in financial wellness programs offered by their employer:

• Reduced financial stress. Gaining financial knowledge and implementing better money management behaviors can help relieve money-related anxiety and stress. This allows employees to focus better at work.

• Better financial security. Employees can build savings, pay down debt, and work towards long term goals by putting the financial education into action. Having financial security helps ensure a bright future.

• Tailored guidance. The financial information is personalized to each individual's unique situation when provided one-on-one by a counselor or advisor. This makes it more practical.

• Convenience. Having access to resources right at work makes it easier to fit into an employee's schedule. The employer essentially brings the advisor directly to staff.

• Free or discounted services. These programs are usually offered free or at very low cost to the employee, making expert guidance affordable. This saves employees money.

• Retirement readiness. Employees gain knowledge to help project retirement needs, save sufficiently in 401ks, and develop strategies. This ensures better preparation.

How do companies benefit from offering a Financial Wellness Program?

Companies can benefit in several significant ways by investing in financial wellness programs for their employees:

• Boosted productivity - If employees are less worried about financial issues, are saving for goals, and have less money stress, they are likely to be more focused and productive on the job. Less time spent stressed means better work outcomes.

• Increased retention - Providing these valuable benefits shows employees they are valued. Employees who feel their company cares about their welfare tend to stay longer term. Reduced turnover saves companies substantial replacement and training costs.

• Attraction and recruitment edge - Prospective hires, especially younger generations, see financial wellness help as a major perk. It gives companies a competitive recruiting advantage in attracting top talent.

• Reduced absenteeism - Financial stresses can take employees away from work more often. By educating staff on money management, companies see less absenteeism saving payroll expense and disruption.

• Healthier company culture - Having open financial dialogues fosters inclusivity and communication between leadership and employees. This also positively impacts productivity.

How to kick off the program?

Decide on an on-site or virtual event if your employees are geographically dispersed. And what's in it for you? You'll save money that would have gone to wage garnishments or 401(k) loans, health care costs and costs associated with delayed retirement. There will also be less absenteeism, and you will boost employee retention and morale.

You'll be improving employee engagement — the emotional impact of financial burdens can be overwhelming. Money is a significant source of stress. Personal finance issues can affect mental and physical health, sleep, self-esteem and relationships. Employees appreciate unbiased financial coaching from experienced CFPs who'll help with earned wage access, student loan assistance and responsible spending, with their overall financial health in mind.

By becoming better investors, your team's happiness quotient would rise. People often are afraid to go to an adviser because they feel unequipped to ask intelligent questions. You can help by giving them information that makes them feel smarter and ready to:

• Take control of their finances by creating an effective budget and taking advantage of high-reward opportunities such as paying the minimum on all debts, taking full advantage of employer matching opportunities and paying down high-interest debt such as credit cards.

• Prepare for the unexpected by setting aside emergency savings to cover modest, unexpected expenses; creating a contingency fund in case of job loss; and evaluating insurance and legal document needs.

• Make progress toward goals by using more tax-advantaged accounts for retirement, health and education, as well as reviewing taxable accounts and setting doable preretirement-age goals such as buying homes and cars and taking vacations.

Financial wellness benefits can help employees understand where they are and where they want to be — to retire with confidence, take fewer 401(k) loans, reduce workplace accidents and overall workers' compensation claims, and have less financial stress, leading to a drop in stress-related illnesses and symptoms, which should drive down your health care costs.

Your team wants to feel in control of its present and future finances and less distracted by these concerns at work. And as word gets around, you may find yourself as the employer of choice because of these financial assistance benefits.

If you'd like to learn what kinds of financial worries your employees are facing and the kind of help they are interested in FIC Human Resource Parntners can partner with you to survey your workforce and identify the elements your Financial Wellness Program should Incorportate.