7 components of a financial wellness program

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Commentary: Chances are you offer some type of wellness plan to your employees. The majority of these popular programs focus on physical health, but adding a financial wellness component is gaining recognition. Many of today’s employers recognize the need to offer a more holistic approach to overall wellness and helping employees manage stress caused by personal financial issues can improve productivity and promote overall wellness. 

Let’s look at seven modules that might be offered as part of a financial wellness plan. These could be offered as a series of lunch and learns, e-learning videos, or as part of ongoing employee wellness education.

1. Analyze spending habits. How can employees save if they aren’t sure what they spend? Encourage employees to log every penny spent for a month. Provide an expense tracking worksheet as part of this module. Employees will be surprised at how much money they spend each month on non-essential items.  

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2. Budget is not a four-letter word. Creating and maintaining a budget can be a challenge for employees of all income levels. Supply a budget worksheet and explain the difference between wants and needs. Once created, a budget can be a powerful tool.

3. What my credit score means to me. Lenders, landlords and even insurance agents use credit scores to determine whether a person is a good or bad credit risk. A higher credit score can result in a substantial savings over time.

4. How to manage debt. Not all debt is bad, but it is important to understand the difference. Sharing a pay-down strategy with employees and explaining how different types of debt can affect their credit score is a simple way to help them get on track to reach financial stability. 

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5. Why do I need an emergency fund? This module explains the importance of establishing a monthly savings goal, defines the expenses an emergency fund should cover and helps employees incorporate savings into their daily lives. 

6. What retirement readiness means to me. Look at ways to encourage employees to participate in your company’s retirement plan. If you offer auto enroll and/or auto increase, good for you, but it is still important that employees comprehend the amount of replacement income they will need at retirement and what it takes to reach that goal. If your plan does not offer auto features, encourage employees to contribute up to the amount of your company match and increase their contribution percentage each time they receive a raise. 

7. Beyond retirement. Managing spending does not stop once employees reach retirement. Personalized guidance that looks at a person’s entire financial picture, including longevity and projected health care costs can have a positive effect on the long-term financial health of our employees.

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These education modules are just a few suggestions designed to help employees make better financial choices. Implementing these ideas may have a measurable impact on overall health and productivity in the workplace. If you don’t yet offer a financial literacy program now is the perfect time to get on board.  

Marianne Marvez is a vice president with Innovest Portfolio Soultions LLC

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Retirement benefits Financial planning Wellness Financial wellness