Working with clients at Your Money Line, we get to see firsthand the impact of implementing a financial wellness program on employees and employers. Innovative benefits leaders understand the importance of financial wellness. They know that the financial well-being of employees goes beyond just providing a competitive salary and benefits package. When they offer financial wellness programs for employees, their workforce experiences positive changes that roll up to company outcomes as well. Let’s explore some of the key benefits we’ve seen for employers and employees.
Benefits to the employee:
1. Improved Financial Literacy:
Courses, financial wellness tools, and conversations with financial coaches help employees understand key financial concepts. This can help them make better financial decisions and feel more confident about managing their money. The first step to making financial changes is understanding the fundamental concepts and applying them to your life.
2. Debt reduction:
Household debt is increasing at its highest rate since 2007 in the US. We see this reflected in our data and conversations with employees. Debt and credit cards are one of our most common conversation topics with Financial Guides. Working with a guide to pay off debt helps employees get out of stressful situations and frees them up to save for emergencies and, eventually retirement.
3. Stress relief:
We consistently hear participant feedback about the relief they feel in taking steps to solve their financial situation. You can imagine the impact this stress reduction has on other aspects of their life. Here are just a few examples directly from participants:
“It can be embarrassing to admit that you struggle with money and have a terrible spending habit...especially as an adult, but my Financial Guide has made me feel comfortable in admitting where I fall short without judging or shaming me.”
“In a scary situation, she has provided me with solid advice, while still being supportive of my efforts so far. I appreciated that she was kind and courteous throughout our exchange and never made me feel judged or shamed. I am very happy to have her service.”
“It’s such a relief to begin talking to someone about this. To help me know and face my financial realities. Thank you for being clear, concise, kind, and helpful!”
4. Retirement readiness:
According to a 2023 TIAA report, financial literacy is positively associated with retirement readiness. Employees who know more can do more to save for retirement. Taking courses, using tools, and talking to an expert about their retirement planning enables employees to assess their financial situation and take steps sooner to prepare for retirement.
Those are just a few of the benefits employees experience when their employer implements a financial wellness program. Let’s turn now to the benefits to employers.
1. Employee satisfaction:
In feedback from participants, we hear not only relief at resolving their financial challenges but gratitude to their employer for offering financial wellness benefits. As one of our participants put it: “YML financial guides always go above and beyond to provide the best and most complete information, answering questions that I didn't even know I had! Thank you so much - I am so grateful to my company for this benefit!”.
This goodwill is reflected in the data as well. According to a study by Mercer, employees who are offered a financial wellness program through their employer
are twice as likely to report being very satisfied with their job and their employer and are more than twice as likely to trust their employer to do what’s right. Increased productivity: A study by PWC found that employees lose, on average, 4.9 lost workdays per year due to financial stress. Reduced stress about finances naturally leads to more productive employees who are focused on the goals and responsibilities of their job.
2. Cost reduction:
Employers spend an estimated $50,000 per year per employee who is unable to retire. Employees who are more financially secure are also more productive and can retire earlier, ultimately affecting the employer’s bottom line.
3. Doing the right thing:
Metrics outcomes aside, the employers we work with most often express their desire to do right by employees and their families by offering financial wellness at work. They see employees in financial stress and know that their investment can help them lead happier, more fulfilled lives. At the end of the day, this is what wellness programming is all about.
Seeing employers and employees experience the benefits of financial wellness for employees is the most rewarding part of my job. What are some of the benefits you’ve seen after putting in place a financial wellness program?