Today's workforce is expected to grow to have more than half of those working, being millennials (with projections being at more than three quarter of the global workforce by 2025). Couple that with the sometimes insurmountable debt of this generation and you can see at least a part of why Financial Wellness Programs are increasingly being implemented as an employee benefit.
We have seen a massive shift in the culture of today's workplaces. Today's labor force is more interested in balance, wellness, connection, and meaningfulness than generations in the past whose priorities were more about a steady paycheck and advancement opportunities.
The shift has been to one that includes increased benefits of a different nature than in the past, including workplace wellness.
The Journal of Employee Assistance defines workplace wellness as "A set of organized activities and systematic interventions, offered through corporations/worksites, managed care organizations, and governmental/community agencies, whose primary purposes are to provide health education, identify modifiable health risks, and influence health behavior changes."
Today, however, a wellness program can include anything from continued education to work-life balance to financial well being.
Emergence of Financial Wellness
The Employee Benefit Research Institute (EBRI) built on research conducted by the Bureau of Consumer Financial Protection to explore what employers are doing to institute Financial Wellness Programs (FWPs), what their challenges and concerns are, what is working best and which FWPs are most beneficial thus far.
Their research found that most FWPs were in their infancy and many were considered to be in the "pilot phase" or "as periodic campaigns or ad hoc programs."
The Consumer Financial Protection Bureau began researching FWPs because of the crushing debt that resulted from the great recession. Increasingly, employers were discovering that financial distress was leading to lower productivity, less employee engagement, and increased absenteeism. In response, they published a comprehensive report that reviews "promising practices and policies" of FWPs in the workplace.
Overall, employers who participated in the review found their wellness programs were beneficial to their employees and, thus, to their bottom line.
Components of Financial Wellness Programs
The first most crucial aspect of a successful FWP is to get to know the real challenges of each employee. Having Human Resource professionals or financial planners sit with each employee to have an honest discussion about their needs, is the first step to establishing an effective financial wellness program.
Once your company understands the stresses and challenges of your employees, you can begin to implement various programs aimed at helping them feel more financially secure.
Financial Education and Coaching
HR professionals reported that overall lack of monetary funds was the greatest concern for employees making financial education and coaching an important aspect to a successful FWP. Helping employees learn healthy spending habits and guiding them through the process of making large financial decisions (such as buying a home or vehicle) can have a great impact on how they manage their finances.
Today's workforce is in a constant state of evolution due in large part to the ever-evolving state of technology. As a result, many of today's workers need to stay on top of growing trends and changing technologies. Equally as important, employers who invest in continuous learning for their employees see increased productivity, employee engagement, and profits. Investing in continuous education provides employees with the skills and knowledge they can use to advance and thus, earn more money.
For many of today's workers, something as seemingly small as a car repair can throw them into a financial tailspin. Today's employers can offer loans to their employees to help them over the slumps of a financial emergency so they are better able to focus on work without having to worry about their unexpected expense. Johns Hopkins University is one such organization that provides emergency help for their workers as a way to help them with a healthy work/life balance..
Long- and Short-Term Planning
Whether through a 401K plan, investing, or other strategy, employees can learn how to invest smartly to prepare for their future as well as meter their spending so they can have a small amount of savings set aside in the event of an emergency.
Ultimately, having a Financial Wellness Program will make your employees feel valued as well as more secure. Providing them with valuable learning is just one of many ways you can help them climb their career ladder. Contact Lorman today to find out more about how we can help to strengthen your company's workforce with continued learning.