If you’re a small business owner, chances are at least some of your workforce is stressed and distracted by money worries — making them more drained and less productive at work. Studies show that 73 percent of Americans say their finances are the top source of stress in their lives. And of those who are employed, nearly half say personal financial issues create distractions at work.
These stats could paint a worrying picture of the mental health of your employees. They could also affect the bottom line of your business. Each year, employers lose an average of $1,900 per employee in lost productivity due to financial stress. This explains why more and more employers are offering financial wellness programs as a workplace benefit.
Financial well-being is mutually beneficial for employees and employers. Such programs can improve the financial health of your organization while increasing employee productivity and engagement. Let’s take a closer look at employee financial wellness programs and the benefits they can bring to both employees and employers.
Employee financial wellness programs are programs that help employees better manage their finances and reduce financial worries. As such, they contribute to the better overall financial well-being of employees.
When it comes to employee financial wellbeing, employers can implement a variety of programs and offerings. Some focus solely on financial education, while others add employer matching, financial assistance, and other opportunities into the equation.
Education-oriented programs can offer employees, for example, financial workshops on home ownership, retirement planning, budgeting or debt management. Employer matching programs may involve matching a percentage of employees’ pension contributions against their 401(k) or against student loans. And other types of financial assistance might include college tuition, medical bill negotiations, or financial planning grants.
The key to a successful financial wellness program is to first identify the specific needs of your employees so that you can more accurately meet those needs. Different workforces have different financial situations and require different programs.
In a recent survey, nearly 70 percent of employers said they recognize the value of offering financial wellness programs to make them more competitive in hiring and retaining employees. If you haven’t already considered a financial wellness program for your employees, consider how adding one could benefit your organization. This can cause:
The potential to increase job satisfaction as your employees gain more confidence in their financial direction in life.
Improved productivity for employees who are no longer overwhelmed with worries about their financial situation.
Better retention of employees who find greater satisfaction in work they believe meets their financial needs.
The potential that employees who are less stressed about their financial well-being will enjoy better health, resulting in fewer medical problems and reduced healthcare costs.
Financial wellness programs should be viewed as an attractive addition to your company’s Total Compensation Plan.
The plans can be structured to suit the needs of your business. Contact your financial advisor. Ameriprise Financial and other companies have programs that can be designed to benefit your employees.
Jeff Jolly, CFP, is a private financial advisor and senior vice president at Ameriprise Financial Services, LLC, located in North Haven. He specializes in fee-based financial planning and wealth management strategies and has been in the practice for 16 years. Contact him at 203-407-8188 ext. 330