Commentary: Flu season is just around the corner and your benefits team has probably set up free flu shots for everyone in the office. But are you also offering financial wellness programs to shore up your employees’ immunity against financial stress?
According to Alliant Credit Union’s recent survey of over 400 HR executives of companies with 1,000 or more employees, the cost-savings and productivity boosts realized from financial wellness programs are nothing to sneeze at. So why is financial wellness the next big thing in benefits?
Also see: “11 scary things employees do with their benefits.”
The 2015 Consumer Financial Literacy Survey shows 70% of U.S. adults have financial worries. These concerns cause unintended side effects to U.S. employers with employees taking an increasing number of sick days and disability claims due to financial stress and performing personal financial tasks during the work day, while still on the clock.
So it’s not surprising that 76% of employers surveyed by Aon Hewitt in 2013, said they were interested in financial wellness programs. There’s a healthy ROI associated with this benefit. The Consumer Financial Protection Bureau cites a payback of $3 for every $1 spent on financial wellness and 43% of the Alliant survey respondents saw an increase in overall employee engagement.
When and why did employers become the financial advisers of their employees? Don’t people learn that at home or in school? It’s tempting to think that educating employees on the fundamentals of finance is something new, aimed at a younger workforce, since millennials now comprise the largest demographic group in the U.S. workforce. While millennials do face specific challenges such as record-high student loans (the average household student loan debt now tops $32,000) and a lack of fiscal experience, no employee age group is safe from the potential plague of money issues.
For example, the Schwartz Center for Economic Policy published a report in April that estimates 33% of current workers aged 55 to 64 are likely to be in or near poverty when they retire due to lack of financial preparedness or discipline. Starting three generations ago before millennials ever entered the labor market, employers partnered with employees to provide financial support and guidance via Social Security programs, then pensions, and later 401(k) plans and stock-based compensation. It’s only natural that employees would seek financial wisdom from their companies that, by the way, also serve as their primary source of most Americans’ income, health and life insurance.
As employers, we’ve done a great job of rolling out benefits around health and mental wellness. Now that we understand the direction correlation financial wellness has on stress reduction and workforce productivity, the time is ripe for the widespread roll-out of this type of program. In a recent Bank of America report, 90% of large firms surveyed said they believe financial solutions will be standard in employee benefits packages in the next decade.
Also see: “Aetna makes financial wellness part of its culture.”
While we recognize that programs like financial wellness help employees and the balance sheet, it is also gratifying to remember that a fiscally responsible workforce produces a booming economy through more retirement savings, less bad debt, less poverty, less stress and less government-funded aid. Offering financial wellness benefits to your employees is a sound investment that will pay dividends to both current and future generations.
Keith Kitani is CEO of Guidespark, an employee engagement and communications company.
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