Tend to Your Employees’ Financial Health
May 11, 2022
Most U.S. workers are not comfortable admitting they need help with their finances. Day after day, financial stresses can take a toll on physical and mental health. According to the American Psychological Association, chronic financial stress can lead to depression, insomnia, anxiety, heart disease and diabetes.
To help employees manage stress and health concerns, many organizations sponsor wellness programs that encourage healthy eating, preventative care screenings, exercise, counseling, meditation and mindfulness. However, programs may not address the causes of stress. Health issues can have a direct impact on your organization’s bottom line through healthcare costs, absenteeism, productivity and delayed retirement.
In a 2020 survey by the Society for Human Resource Management, 80% of employers said financial stress reduces employee performance — totaling nearly $500 billion each year. In addition, workers with financial concerns are 2.3 times more likely to seek a new job.
Consider some recent statistics that show how Americans are struggling with their personal finances:
Your employees may not be speaking up and requesting help, but they need a financial well-being program that does more than offer online retirement income calculators or sessions with investment specialists. Employees need a financial well-being program that helps them improve their ability to live within a budget, reduce debt and save for the future.
Encourage Fiscal Health
Poor financial wellness is a national epidemic, and employees of all ages could benefit from company-sponsored programs that effectively promote financial education and help to prepare them for a financially secure and on-time retirement. Research conducted by Everyday Health indicates 52% of survey respondents are stressed from financial issues, far surpassing the 35% who listed jobs and careers as their primary cause of stress.
Help Employees Take Control of Their Finances & Save More for Their Future
A key component of achieving financial wellness in the workplace is making sure your participants are financially prepared to retire. Employers have begun to focus on employee financial wellness to better understand the barriers employees face in saving for retirement. If employees aren’t able to tackle their short-term goals (i.e., pay down debt, establish emergency savings, afford healthcare), they won’t be able to start to think about retirement.
Helping employees improve their retirement readiness can also help mitigate the projected economic costs to your business. Our recent article, Is Delayed Retirement Impacting Your Bottom Line?, reports that employers spend more than $50,000 per employee each year an employee delays retirement. In other words, employers implement financial wellness programs not only to help their employees now, but also to help employees achieve the financial freedom to retire. The potential savings to an employer can be millions of dollars.
Achieving financial wellness and retirement readiness depends on workplace benefit offerings. Effectively designing and rolling out a financial wellness program requires setting a strategy, establishing goals and objectives, utilizing data and tools, creating engaging communications, measuring results and adjusting based on results.