Financial Wellness Programs: 5 Better Ways to Help Employees

Financial stress continues to be a growing concern as more and more people face mounting economic pressures, high-interest debt and unexpected expenses.

While employers can’t solve every financial challenge for employees, it’s still a good idea to talk about financial wellness.

5 Strategies to Promote Financial Wellness

How serious is financial stress? In a study by FinFit, 60% of employees said they experienced stress and anxiety when thinking about their finances in the past week. This stress can have far-reaching effects, affecting their mental health, productivity and overall well-being. 

1. Identify the Right Approach to Financial Wellness

An organization’s financial wellness resources may include access to financial advisors, budgeting tools and financial education courses. Specifically with financial education courses, many HR leaders put much effort into Financial Literacy Month in April each year. 

According to research from Credit Karma, nearly three-quarters of consumers have financial regrets, with not saving money being the most common. While many people think there is a direct correlation between salary and financial health, that’s not the case. Financial health can be impacted by expenses, savings, investments, debts, credit scores and regular habits surrounding financial planning. 

Financial Literacy Month serves as an opportunity to discuss financial wellness and support employee financial health and wellness by reminding employees of their total rewards packages. This can be done through webinars and onsite wellness events, in partnership with benefits providers, and in collaboration with internal communications teams. 

2. Engage Employees to Identify Challenges and Opportunities

In Morgan Stanley at Work, 91% of HR leaders reported they suspect employees are facing financial hardships. While some employees may be willing to disclose their hardships to HR, it’s not the case for every employee. Research indicates that financial stress may make it more difficult for employees to seek support proactively. 

While this may be a difficult conversation to dive into, HR leaders can approach it from a few different angles to make the conversation comfortable, honest and productive. Here are a few effective approaches:

• Move from input to impact. Use the Intranet or a third-party survey to conduct qualitative research, quantitative research, or a combination to understand the workforce’s current sentiment around their personal financial health and financial priorities for the year ahead. Consider sending out an annual benefits survey at the beginning of the year to determine how employees feel about the company’s benefits, specifically when it comes to financial wellness. 
• Have ‘money talks’ to keep the conversation going. Conduct a focus group of employees across different levels and departments to get qualitative financial wellness ideas on the impact of current macroeconomic conditions and feedback on current employee benefits. 
• Hold one-on-ones. Either following a survey or by providing employees with the opportunity to volunteer for these discussions, HR leaders can connect with employees across all levels to conduct more intimate one-on-one conversations about the current state of their financial health and discuss whether the current benefits available are supporting them. 

3. Find the Right Balance of Total Rewards

Based on the feedback received from employees, HR leaders should identify and roll out additional offerings to their total rewards packages to ensure that there is something for employees of all generations to use. This includes benefits that support physical and mental health and financial wellness.

While primary benefits like healthcare insurance and healthcare savings accounts prepare employees for unexpected illness, businesses should also consider voluntary benefits that address more immediate financial needs. 

For example, employers could implement an emergency savings program (ESP) so employees can direct funds into a rainy-day account before the remainder of their paycheck posts to their primary checking account. 

In addition, voluntary benefits, like an employee purchase program, enable employees to split large purchases, such as major appliances or spare tires, across multiple fixed, interest-free payments taken directly from their paychecks.

4. Continuously Improve Financial Wellness Programs

Supporting employee financial wellness doesn’t end when the total rewards are refreshed in advance of open enrollment season. Coupling the resources with an engagement and educational strategy for employees is key to ensuring that these benefits are being used and providing the support they intend. 

By ensuring employees are aware of the benefits they have available to them, especially during periods of financial hardship, HR teams can expect to see the following outcomes:

• Stronger employee experiences. A Bank of America study found the majority of employers agree that offering financial wellness support can result in more satisfied, loyal, engaged and productive employees. The report also found that most employers believe it reduces attrition.
• Bridging generational divides. The Employee Benefits Research Institute (EBRI) found junior employees just starting their careers tend to place high value on benefits that help with day-to-day bills and student loan debt assistance. This may be because they are in the earlier stages of their careers and are still adjusting to new financial circumstances. Comparatively, EBRI found that older employees are more focused on retirement benefits. By providing the right resources and education at the right time, all employees can be empowered to proactively plan and act on both short- and long-term financial goals to set themselves up for success.
• A level playing field. Creating a workplace with resources and opportunities for employees to support financial and personal well-being can level the playing field for prospective employees who may not have otherwise applied for a role with the organization. Research from PNC Bank found that 92% of Gen Z are more likely to stay with an employer that offers financial wellness benefits, with 72% of Gen X and 64% of Boomers saying the same. Not only do these types of benefits support retention of the workforce, but they can be leveraged to position the company as an employer of choice to attract new talent.

5. Build a Long-Term Financial Wellness Strategy

Beyond creating a workplace for professional success, HR teams should identify and pursue opportunities to support employees’ well-being, including their financial health and wellness.

Find ways to bring attention to financial wellness throughout the year to help employees get more out of their benefits and spend less time stressing about money. For example, HR leaders can:

• Develop a year-round financial wellness calendar. Incorporate financial education and benefits communication started during Financial Literacy Month into ongoing employee engagement efforts throughout the year.
• Leverage HR technology for accessibility. Ensure financial wellness resources – such as budgeting tools, financial coaching, and educational materials – are mobile-friendly and available on demand.
• Measure impact and adjust accordingly. Track participation in financial wellness initiatives, assess employee feedback and make data-driven adjustments when necessary to boost effectiveness.