Financial wellness is a vital aspect for the overall wellness of a person. It positively affects the financial state of an individual thereby contributing to a safe and secure life. Owing to its importance, it is also a huge concept.
As such, financial wellness is one aspect wherein proper knowledge is vital. In this scenario, adequate guidance becomes crucial. It is why, for the financial wellbeing of your workforce, your assistance in the matter becomes critical. Here, awareness of a few employee financial wellness tips and other related issues goes a long way.
This article discusses the tips that will help your employees gain knowledge about financial wellness. As such, you must be hands-on in this aspect to provide your best efforts to aid your workers.
As an employer, there are two things you can do to spread awareness of employee financial wellness—first, the things you can do as a company, like designing a few employee benefits. Second, a few of the employee financial wellness tips you can share with your team to help them handle their finances better.
4 Things Employers Can Do To Enhance Employee Financial Wellness
1. Spreading awareness
Knowledge is the biggest asset one can have to lead a healthy life. It is the case with financial wellness as well. A well-educated workforce can handle their finances much better than an ill-educated workforce. To ensure this, you must discuss the topic of financial health in your business meetings.
You can invite your local financial firms to hold seminars to give professional guidance in this area. Furthermore, there are also many online forums where you can learn about financial wellness for educating employees on financial wellness.
The key here is to spread awareness on how to attain financial wellness and its importance.
2. Design a benefits program
Many companies have different benefits package and programs to attract talent. In this program, you should also include some benefits to help your workers attain financial health. Benefits like loan application assistance, office gym membership, insurance, affordable healthcare programs can help your workers cut down their personal finances to a vast extent.
In return, these programs translate to their better financial wellness state.
3. Employee Financial Wellness Programs
Mere help of tips is not enough all the time. In some scenarios, you also need to provide some financial assistance to your workers to help them in tough situations. Here, designing a proper employee financial wellness program can be very handy.
In these programs, you can make provisions of financial aid in some particular cases. These situations can be at the time of pregnancy, medical emergency, natural disasters, accidents on the job, etc.
Lastly, your employees can always benefit more from professional help. As such, providing them with some financial employee counseling by professionals from time to time will be hugely beneficial. Here, you can invite the local financial agents to advise your workers on the same.
These agents can advise on many vital issues affecting one's financial wellbeing. It can be insurance, loan, debt, investment, retirement planning, etc.
Providing accurate information on these issues is crucial, and hence counseling is of great help in this regard.
These were a few of the steps you can take as employers to help your workers become financially fit. Now, let's get to the second way of helping your workers; the employee financial wellness tips.
One of the first steps towards financial wellness is one's initiative. As such, one must have enough education to make the right financial decisions. In doing so, you can help your workforce by enlightening them on a few financial wellness tips. Let's take a look at a few of these.
6 Employee Financial Wellness Tips For Your Workers
1. Living paycheck to paycheck
One of the pitfalls of millennials is their tendency to live paycheck to paycheck. They tend to exhaust their salary on the first few days, which hurts their way of living in the latter part of the month. This tendency also prohibits them from making any savings. Hence, they tend to live their life from paycheck to paycheck.
This is a habit that needs to be changed. You must make your workers aware of scheduling their salary for the whole month. It means dividing the money equally moving along the month. Here, the 50-30-20 way can be of great help.
Here, the workers can spend 50% of the earnings on their daily utilities for the month, 30% on their daily expenses, and save 20% for a rainy day. It will enable employees to prepare and allocate their finances better.
2. Emergency funds
Having emergency funds is crucial for every individual. To attain this, one must have the golden habit of savings. Encourage your workers to save a portion of their income every month. It is also helpful to divide that saving into two halves. One for emergencies and one for personal financial needs use like a car, capital, etc.
3. Proper investment opportunities
Investment from an early age is an excellent habit. While savings are significant, investments are a smarter way to increase wealth. By making sound investments, one can sit idle while the investments work themselves to create more wealth. As such, your workers should also be aware of suitable investment opportunities in their capacity.
Here, mutual funds, fixed deposits, share markets are good options to consider.
4. Student Loan Debt
Student loans are an issue that troubles most workers on a global scale. Therefore, one must prepare themselves adequately to meet these loans on time. One way of doing so is refinancing the student loans to get a better deal based on the current situation.
While going for refinancing, you must advise your workers on a few crucial aspects. These are the flexibility of the terms and loan type, interest rate, benefits of refinancing terms, and the refinancing process.
5. Debt Management
Debt is yet another aspect that troubles one's financial wellbeing. Here, one must be sure to pay off every debt, but your workers should prioritize these debts as well. The ones bearing a higher rate of interest should get priority. It means paying off the debt with higher interest first and paying off the whole amount as soon as possible.
6. Tax Advantage
Though taxation is a legal and moral obligation of every citizen, it is a very costly affair. Depending on the salary bracket, your workers can be paying around 10% to 30% tax on their income. It is a vast amount that can be better utilized to pay off debt, contribute to savings, or invest.
Fortunately, there are many ways wherein workers can get tax advantage legally. You must advise them to talk to their agents and find out these ways. Some of these can be tax deductible on loans, certain investments, etc.
These are a few of the employee financial wellness tips that you can bestow upon your workers to help them attain overall financial wellness.
Employee financial wellness is a crucial aspect of overall employee health. Here, though this is a very desirable aspect, only a handful can attain it. By asking this handful few, you can be sure that their secret is proper knowledge, initiative, and execution.
As for information on the first part of "knowledge", we hope you got a good start from this piece.