Financial wellness is a vital issue that all companies must address in their overall employee wellness initiative. Finance plays a substantial role in improving the holistic wellness of an employee. Oftentimes, this issue can take such precedence that it can even torment the mental health of the individuals.
As such, it becomes imperative to handle this issue effectively. Financial wellness will not only enhance productivity but also the mental health of the workers as well. Therefore, it becomes crucial to include provisions for financial wellness in the corporate wellness programs.
Here, for effective implementation of financial wellness, we must first understand the concept.
What is Financial Wellness?
In layman’s terms, it is the ability to manage one’s economic life effectively. It means spending within one’s need and capacity, preparing emergency funds, planning for the future, and being well-informed enough to make sound financial decisions.
All of these decisions account for the financial stability of the workers. Here, you as employers can also play a crucial part in helping these workers be financially stable.
You can assist your workers with the best market plans by collaborating with financial giants of the industry, spreading awareness in the workplace, etc. All this will help prepare your workforce from their workplace rather than running from company to company for quotes and advice.
The importance of this assistance for financial wellness can also be well-understood from different relevant statistics.
Some Useful Financial Wellness Stats
A study published in Best Money Saves states that
- 50% of the workers spend more money than they earn.
- 37% of employees admit that they have more debt than they can manage.
- 41% of the workers cite that they don’t have much savings to cover even 3 months without pay.
Furthermore, a study by PWC will give you a fair idea of the current scene of financial wellness.
1. The Current State of Financial Health
When asked about their financial wellness state, the respondents responded:
- 34% of respondents state that they were not worried about their personal finances.
- 18% said that they are debt-free in their life.
- 16% are well-prepared to meet any unforeseen emergency.
- 16% cite that they have enough resources to make their life choices as they please.
- 12% live paycheck-to-paycheck wherein they can meet their expenses.
- 4% can take retirement instantly if they please.
2. Choice of Benefit in Financial Wellness Programs
On the question of the choice of financial benefits, the respondents replied:
- 27% said that they would like counseling for their financial goals.
- 26% would appreciate assistance in student loans.
- 17% cite that they would like to have proper knowledge of how to use financial wellness tools.
- 16% would like protection on aspects like identity theft and credit protection.
- 8% would prefer to have mobile access to all their financial benefits.
3. On the effects on Financial Wellness
The respondents were asked about the areas in which they suffered due to improper financial wellness. Respondents replied:
- 32% cite that bad financial wellness affected their health.
- 32% say that their relationship at home suffered due to financial wellness issues.
- 21% replied that their work got influenced.
- 10% say that financial wellness has effects on their absenteeism rate.
- 9% speak of other areas where they suffer due to poor financial health.
These were some stats showing the prevalent results in financial wellness.
Judging by the stats above, providing the necessary financial wellness benefits is a crucial part of promoting and regulating your employees' wellbeing. Here, let’s also discuss some of the advantages of doing so in brief.
Advantages of Employee Financial Wellness Benefits for Financial Wellness
1. Improved Productivity
Taking care of certain problematic aspects like loan application assistance, student loan, debt reduction programs, financial counseling, etc., can free up a troubled mind. When your workers are not burdened with these thoughts, they can concentrate more on their work. It will ultimately help with employee productivity.
2. Employee Satisfaction
When you take care of your workers, it always positively impacts their employee satisfaction levels. By deciding on a few employee financial wellness benefits, you can be sure of a spike in the satisfaction levels of employee satisfaction or job satisfaction.
There is always a fear of losing your talented workers to other companies in the current competitive space. The main result of this outcome is because of dissatisfied workers. Here, one must be conscious of offering the best possible environment and benefits to keep the workforce happy.
It takes more than proper hiring strategies to get the best hire. You must attract talent to your office, and nothing does it better than a competitive benefits package. By designing a few financial benefits in your package, you can be sure to attract the best available talent. It further helps to sign your desired candidate.
Poor financial wellness can harm workers both physically and mentally. Many workers resort to two jobs to make ends meet and make other similar provisions as well. This tendency to work 24x7 affects employee health. The constant work can deteriorate one’s mental health and physical health.
In the end, they end up tired and with loads of stress and diseases resulting in decreased productivity. The health issue can also lead to massive absenteeism. By helping your workers be financially secure, you can take an enormous load off of their minds. It can then help to lower absenteeism.
These were a few of the positives of having financial wellness benefits in your package.
Here, it is also essential to understand what benefits your workers require to design a holistic financial wellness benefits plan. To do this, you must ask your workers about their needs and then decide accordingly.
Furthermore, you should also make your workers aware of some employee financial wellness tips as well.
Financial wellness is a crucial part of a holistic wellness approach. As such, it must be an element of your employee wellness programs. As discussed above, it has many positive effects that can reap rewards for your efforts in the long run.