The Best Financial Wellness Benefits To Offer Your Employees
With a looming recession dominating headlines recently, it’s no surprise that employees are concerned about their financial future, so much so that 51% of workers report spending 25% of their workday worried about it. In this environment, employees are increasingly looking to their employers to alleviate their stress, with 82% of workers saying employers should play a role in supporting their financial wellness. By offering financial wellness benefits, you’ll differentiate yourself among employers and boost recruitment and retention. Not sure where to start? We’ll help you understand the top options to consider.
In this article, we’ll discuss what financial wellness benefits are, the advantages of offering them, and the best benefits you can provide employees. After reading this, you’ll be in a good position to understand whether providing financial wellness benefits is the right approach to position your company as an employer of choice today.
What are financial wellness benefits?
Financial wellness benefits are perks that help employees save, better manage their money, and retire with confidence. It’s important to note that while you may decide to offer a variety of financial wellness benefits, which we’ll describe in a bit, they should all work together holistically to give employees a big picture approach to their financial security. Otherwise, you risk not having the impact you want. For example, if you offer short-term loans by themselves, they may be helpful immediately but not in the long-term unless they’re also paired with services that will enable employees to reduce expenses, manage debt, and handle their money.
What are the advantages of offering financial wellness benefits?
By addressing your employee’s financial challenges, both you and your workforce stand to benefit. Some of the top advantages of offering financial wellness benefits include:
- Increased productivity: By alleviating stress and arming employees with the tools they need to achieve financial security and reach their life goals, you’ll reduce distractions at work and improve morale, which can boost productivity levels.
- Greater safety: As we just mentioned, since financial wellness benefits can improve employees’ focus at work, it can also reduce the chance of a workplace accident or injury. This, in turn, can lower your workers’ compensation expenses.
- Improved recession planning: With 80% of employees already concerned about inflation and talk of a recession, financial wellness benefits can help employees build their emergency savings so they have a safety net in case of an economic downturn.
- Lower absenteeism: By reducing their stress, financial wellness benefits can reduce the likelihood of stress-related illnesses and symptoms and, as a result, the number of days workers call in sick or simply don’t show up.
- Enhanced retention: With 73% of employees wishing their employer offered more financial wellness benefits, you can improve satisfaction and loyalty by providing workers access to the resources they’re looking for.
Which benefits can I offer my employees?
The list of financial wellness benefits continues to grow as more employees seek these perks from their employers. But the most in-demand benefits include:
- Financial literacy courses: Education can help employees on their journey to financial wellness. Consider offering classes about how to budget, prioritize spending, identify more opportunities to save, and prepare for emergencies that can help workers make better decisions.
- Investment guidance: While education aimed at encouraging employees to increase their savings is a good start, it’s a good idea to help them understand how to build an investment strategy with their savings. Options your company could consider include meetings with financial advisors, offering in-person or live webinars, or other advice and tools to help them achieve their goals.
- Retirement plans: An employer-sponsored retirement plan remains one of the most sought-after employee benefits. To help encourage participation, use auto-enrollment and escalation features. If you can, offer a match with a vesting schedule that will not only help employees increase their savings but also improve retention. Be sure to couple your plan with resources that will let them know if they are on the right track towards their retirement nest egg.
- Recession planning advice: Beyond saving for retirement, many employees need help with more immediate needs like paying down high-interest debts or increasing their emergency savings. Financial advisory services can help workers get ahead of a possible recession by taking the proper precautions to be as prepared as possible.
- Insurance: Consider offering voluntary benefits like life insurance or short- or long-term disability insurance that can help protect workers and their families and provide a much-needed safety need in the event of a life-changing emergency.
- Financial assistance: This benefit can take a number of different forms, from student loan repayment assistance to an employee relief fund or employee crisis fund that can help for things like temporary medical or housing expenses. If you offer a 401k plan, you may want to think about including a plan loan or hardship distribution feature.
How to Best Select Financial Wellness Benefits for Your Employees
The benefits we discussed here are just some of the options you may want to consider. The key is to find out what your employees want and that will be most valuable to them. Solicit their input informally or through a survey to understand what will help them navigate their financial life journey. Review the demographics of your workforce to see how many employees may need help with paying off recent college debt versus impending retirement. Create a plan that includes a variety of tools and support, then connect with employees regularly to see if you need to add or change the program.
The bottom line is that employees are looking to their employers for help. And by meeting them where they are, you’ll reap the benefits as well: a happier and more productive workforce that is likely to stay. Read our next article on how financial wellness benefits can fit into your overall voluntary benefits strategy to attract and retain top talent.