What Are Financial Wellness Programs (And Are They Right for Your Business?)
Financial stress is an all-too-common burden affecting millions of Americans.
This fact has long evaded U.S. business leaders, to little surprise. After all, many people keep quiet about their personal financial situations at work in general, and to their superiors in specific.
But increasingly, corporate decision-makers are waking up to the reality that some of these struggling Americans are their very own employees … and that said financial stress is accompanying them to the workplace.
To combat this, companies are turning to financial wellness programs.
What Is a Financial Wellness Program?
Financial wellness programs are provided by employers to help employees manage their financial lives more effectively. These programs typically include a range of services, including (but not limited to):
- Financial education
- Budgeting tools
- Debt management assistance
- Retirement planning
- Access to financial advisors
The goal is to empower employees with the knowledge and resources they need to achieve financial stability and reduce stress related to money matters.
The Need for Financial Wellness Programs
Financial wellness programs have become increasingly necessary due to a variety of factors. Many employees live paycheck to paycheck, struggle with debt and have insufficient savings, leading to significant financial insecurity and stress.
This stress not only affects their personal lives but also spills over into their professional lives, impacting their overall well-being and productivity.
“Why not just pay employees more?” is a common refrain when skeptics hear about financial wellness programs. In reality, financial wellness programs are often inexpensive to provide, and they address a problem that can plague anyone, regardless of economic status: financial illiteracy.
A significant portion of the workforce lacks basic financial literacy. Without proper guidance, employees are more likely to make poor financial decisions, which can exacerbate their financial instability and increase their related stress.
Addressing financial wellness and literacy can help mitigate these costs by promoting well-being among employees.
Benefits for Employees and Employers
Financial wellness programs are a boon for employees and employers alike.
- For employees: Financial wellness programs provide the tools and knowledge needed to manage finances better, leading to reduced stress and improved mental health. Employees are given valuable insights into managing their money, investing and planning for the future, typically through workshops, seminars, videos, articles and even one-on-one counseling. This improved financial literacy encourages more effective saving for emergencies, retirement, and other financial goals, resulting in greater financial security. With reduced financial worries, employees can focus better on their work and personal lives, enhancing their overall quality of life.
- For employers: Employers also stand to gain significantly from implementing financial wellness programs. When employees’ financial stress is alleviated, they can concentrate better on their work, leading to increased productivity. Financial problems can lead to absenteeism due to stress-related illnesses or the need to handle financial issues, so these programs can also result in a more dependable workforce. Employees who feel supported by their employer are more likely to be engaged and loyal, boosting morale and retention rates. By addressing financial stress, employers can also help reduce the health issues associated with it, leading to lower health care costs over time.
Should Your Business Start a Financial Wellness Program?
Financial wellness programs are a valuable investment for companies aiming to foster a supportive and productive work environment. And they’re not just for large employers. Midsize and even small businesses can often implement programs that will help bolster their employees’ financial security.
Want to learn more? Reach out to McManamon & Co., which offers a variety of business services to small and midsize firms — including consulting on a wide range of employee benefits. Call us today at 440.892.8900 or contact us online.
Tags: employee benefits, McManamon, McManamon & Co., small business, small business consulting, small business finances | Posted in McManamon & Co., small business