Invest in a tailored Financial Wellness Program to Maximize Outcomes
If you’ve landed on this blog, you may be among the hundreds of company management teams that have realized the irreplaceable benefits of providing workplace financial wellness to your employees.
Once a progressive concept, financial wellness solutions are being adopted more and more. As of 2017, Mercer, an employee benefits provider, estimated that there were more than 300 financial wellness vendors in the U.S. While this illustrates the demand for these programs, Mercer is quick to point out that not all programs are created equal. Curriculum and execution differ greatly (Center for Social Development, George Brown School of Social Work). The key to reaping the best outcome of a financial wellness program lies not in deploying a replica of what others have found successful, but rather in thoughtful tailoring to your employees’ specific needs.
If you or your company is thinking of skipping a tailored approach, here are 3 arguments to consider:
Generic Workplace Financial Wellness Fails to Engage
The payroll of most companies includes a range of individuals with differing lifestyles. It’s common to employ a CEO and a janitor. How realistic is it, then, to assume that their financial struggles are the same? Those with higher salaries may care deeply to learn about wealth management and retirement planning, while those with smaller incomes may be discouraged if saddled with the same goals. The same is true if the offering is reversed. Both cases result in loss of employee engagement due to lack of applicable information. Workplace Financial Wellness must adapt to meet individual needs, perhaps, as part of common themes or risk a failure to launch.
In its own study, MetLife determined that companies could improve the lives and performance of their employees through two means including “initiatives around financial education, which ideally reduce financial stressors, increase financial literacy and improve financial behavior on the part of the employees.” Clearly, these objectives cannot be met without first identifying financial stressors and poor behaviors and then tailoring program content to address them. The greatest success will come when employees can take hold of their own progress as a result of being supplied with the very information they have needed in order to move forward.
In the same report, HelloWallet confirms that effective workplace financial wellness programs “do not offer a uniform array of services applied indiscriminately to populations with diverse financial needs; rather, they are personalized, data driven, and aimed at behavioral change (2015).
Tailored Financial Wellness Programs Increase Loyalty
Paycheck Direct, while researching for a whitepaper, discovered that “93% of employees enrolled in a financial wellness program planned to continue enrollment in the future (2014)”. This not only speaks to the value that employees place on Workplace Financial Wellness programs, but in considering their future in the program, indicates that they have begun to consider a future with their company.
As mentioned in a previous article, if a program improves household money management and retirement planning, and minimizes financial burden, as these programs commonly do, then employees consider it a company benefit worth sticking around for.
Identified as a particularly effective tool for shaping employee performance and building loyalty, is financial coaching. According to an analysis performed by the University of Wisconsin Institute for Research on Poverty, ideal financial coaching consists of encouraging employees through financial goal setting and creating paths to achieve their goals (Collins & O’Rourke, 2012). As employers work alongside employees in this process, employees become less likely to abandon a company that has made such a personalized investment.
Additionally, Financial Wellness Programs deliver such benefits as increasing job stability and overall work satisfaction (Grinstien-Weiss and Lass 2013). Are these not key components in fostering loyalty?
Successful Outcomes of Tailored Programs Have Proven to Be Replicable
EMC Wealthlink’s main purpose in developing a financial wellness program was to strengthen employee retention and attraction through personalized resources. Since their launch in 2008, clients largely continue to have a positive regard for it.
Highlights of the program include:
- 38% of Wealthlink users increased their contribution to a Health Savings Account
- Users showed a 32% increase in the participation of a Non-Qualified Deferred Compensation Plan) wrap around 401(k) plan.
- Flex Spending Accounts saw a 3% increase among users.
Improvements in these areas are common and should be expected when a quality Financial Wellness Program is implemented.
Along with these outcomes, the U.S. Army, which offers its own version of financial education, has observed such benefits as a reduction in the occurrence of poor financial behaviors including making late payments on bills and carrying high credit balances (Prawitz and Cohart, 2014)
Programs that supply individual credit counseling cultivate healthier credit-related decisions and yield higher credit scores among participating employees (Ellienhausen, Lundquist, and Staten, 2007).
If you can succeed in tailoring Workplace Financial Wellness to your employees’ specific needs, you will make observable progress towards fortifying your company through increased productivity, retention, and competitive talent attraction.
Learn how we can supply resources and direction to get you started by reaching out to our Employee Financial Wellness Program Manager , Todd Christensen, at 1-877-688-3328 ext. 906 or Send Todd an Email Here