Financial Wellness Benefits: Why You Should Care?
A penny saved is a penny earned. –Benjamin Franklin
Employers have always shown concern with the possibility of offering financial wellness benefits. Employees worry and stress more about their finances.
In the wake of the Great Depression, employers started to add benefits packages. The goal was to keep and attract the best talents. The idea was also to support the employee's personal needs and goals. This trend of offering benefits has continued in the 21st century and will exist in the coming eras.
In this present era, the number of employees that join is millennials. And 21% of them have said that they want help with their saving which will help them build a secure future.
It has become essential for employers to include a financial wellness program. Your most significant investment is in your employees. You are improving the bottom line by providing them with financial wellness resources.
Before providing the necessary financial wellness benefits, you must educate your employees. It will help them have a strategic approach towards their finances.
As employees care about their health and fitness, they have similar awareness of their finances. And they feel that there is a specific need to maintain a balance between these for a prosperous future.
This article will discuss the financial benefits that your employees need for a better future.
Financial Wellness Benefits that your employees want:
Before delving into the financial wellness benefits let us have a look at a few statistics:
42% of employees say it’s likely they’ll need to use money in a retirement account for expenses other than retirement.
54% of employees want to make their own decisions, but want someone else to validate that they did the right thing.
20% of organizations reported increases to healthcare benefits offerings since 2018.
5% of employees would like to retire when they want to without worrying about their finances.
Keeping the statistics in mind, let us dive into the benefits that you could provide to your employees.
1. Retirement Plans- Planning for the future:
Saving up for the future is an essential plan that every employee includes in their to-do list. A future where they would not want to worry about their finances
One such plan includes the 401(K) program. An employer can sponsor this scheme, and workers can save and spend a part of their paycheck before application for taxes.
The plan has certain restrictions. In most cases, the employees cannot tap into employers' contributions immediately. On top of that, the rules are complex about the withdrawal of money. Furthermore, costly penalties are applicable for pulling funds out before retirement.
But rest assured, the retirement plans are much more effective. All you need to is educate your employees about them. Furthermore, providing retirement plans as benefits will make their future more secure.
2. Student Loan Repayments-Fending off the debts:
Your young employees are the backbone of your organization's future. They are enthusiastic, innovative, and can come up with innovative ideas.
But most of the employees these days are often stressed about their financial status. It is because of the student loan debt. It impacts their productivity and health in the workplace.
As a responsible employer, you can help with a loan repayment program. This program is quite simple. Here an employer only needs to contribute a fixed amount each month towards an employee's student loan principle. This would further lessen their financial burden.
The payable amount will depend on various factors that may include the size of your workforce, your turnover, and future company plans.
This will help them reduce their debt. And in return, you are more likely to get committed employees in your organization. And thus paving a way towards creating a healthy company culture.
3. Flexible Paydays:
The road to reducing debt and meeting ends meet can be long-lasting. Employees with a long list of debts can find it difficult to spend on basic needs. But as an employer, you can take up some steps to countermeasure this problem and reduce their stress.
You can let your employees choose when they get paid, ensuring their financial wellness. Employees who are struggling with their finances will benefit a lot from flexible paydays. The biggest win for them will be able to avoid delinquent payday loans.
With flexible paydays, you will keep your employees happy and pave the way for them to tackle their daily needs.
4. Personalized Financial Advice Programs:
Companies are now focusing on programs that provide certain financial plans to the employees.
Employees have more challenges to face outside of saving for retirement. Teaching employees how to pay down debts is one of the critical financial moves.
Creating an excellent financial advisory program focuses on the critical facts. Like how to plan it and how it will help your employee.
For a financial advisory program to work, you need to have a detailed structure. You need to further assess the outcomes and how they will affect the organization in the long run.
Advantages of a Financial Wellness Benefits:
With having a comprehensive and tailor-made financial wellness program not only will the employees get help from it but as an employer, you are bound to have some advantages as well.
Few of them are listed below-
1. Improved employee productivity:
One of the top advantages that you will get is that there will be an increase in employee productivity. A financial program needs to offer-
Debt reduction programs
Student loan support
This will also help to reduce personal financial hardships.
Financial wellness programs save employees time from concerns over debts and many worries.
2. Increase in Employee Satisfaction:
Employees have reported greater professional satisfaction when they have access to financial programs. Programs that let them set and achieve individual financial goals. It includes contributing to an investment plan, building an emergency fund, and much more.
An employee prepared for unexpected financial emergencies is more engaged at work. It is because they do not have to worry about their finances in the long term.
3. Greater employee retention:
With the help of the financial wellness program, you are more likely to offer employee perks that help them stabilize their money. This will not only help them in the long run but will also help you in retaining your prized assets.
Employees are more likely to stay in your organization if they see that they will have a more significant helping hand with their finances. This increases retention and improves your company culture as well.
4. Strong Employee Recruitment:
In the present era, the competition is high, and job-hopping a common trend. To reduce this, employers have to provide all the benefits and perks to keep their best talents.
Benefits like health insurance provide a strong sense of stability for the employees.
For a strong recruitment strategy, you need to provide support to employees' finances. This, in turn, makes the millennials feel valued in the organization. Thus, leading to higher chances of recruitment in your company.
5. Reduced absenteeism:
With the rise of inflation rates, the cost of living has increased a lot. Due to which employees find it challenging to reach ends meet even if the job is a well-paid one.
This happens because employees rarely have a well-planned financial strategy for their spendings. It can further lead to stress, anxiety, and depression.
Employees might opt for secondary jobs to have some extra money. This might affect their presence in their main job leading to an increased number of absentees in your organization. This can be a significant problem for you and the company.
But you can change this situation for your employees by providing them with financial wellness lessons. These lessons will help them devise out an efficient budget for themselves which will, in the long run, allow them to avoid their financial woes.
Hence, minimizing the possibility to work for another job. Thus, reducing absenteeism tremendously.
Summing it up:
Financial wellness benefits is a program that you must include in your organization. We have already talked about what can be the benefits and what are the advantages you get out of it. Structuring such a program can be time-consuming and might take effort.
But with so much in line, you can definitely make some effort.
Furthermore, this will give a perfect example to others that your organization has an excellent company culture. And a workforce that works with positivity.