Financial wellness programs: A guide for employers

As the cost of living rises across the globe, and more people feel the pinch, financial wellbeing is becoming increasingly difficult to achieve. This makes it especially crucial for employers to step up and provide some relief when they can.

A great way to support your employees is through a financial wellness program. These initiatives provide your people with tools and resources for managing their finances, allowing them to be more focused and engaged in the workplace. 

In this article, we’ll look at financial wellness programs in more detail, and talk about how you can set up your own. So let’s jump straight in.

What is financial wellness? 

Financial wellness refers to an individual’s ability to navigate their current and future financial needs. This includes comfortably managing their everyday expenses, paying off any debts, and working toward their long-term goals, like saving enough for retirement.

Why is it crucial to achieve financial wellness? 

According to the American Psychological Association, 68% of single-adult households cite money as a significant source of stress. These worries can have a significant impact on people’s personal and professional lives. 

When employees are financially “unwell,” this can also be detrimental to your business. They may be distracted at work, preventing them from focusing on their tasks. This can result in a lack of productivity and/or quality. Absences may also increase due to stress, and struggling employees may even have to take up a second job to make ends meet. 

Achieving financial wellness plays a critical role in reducing these financial stressors. Specifically, it helps highlight the factors behind finance-specific challenges and guides people toward taking actionable steps to address them.

In addition, achieving financial wellness encourages people to take the right steps toward long-term goals, like saving for a home, retirement, or their children’s college education. Plus, by learning how to set aside funds for emergencies, they can become more resilient and prepared to tackle unexpected situations.

What is a financial wellness program?

A financial wellness program is designed to help educate people, encouraging them to make better management choices and meet these goals. It can incorporate a variety of strategies, such as financial counseling, budgeting tools, or access to credit resources.

Financial wellness programs allow employees to expand their skills in many key areas. With these insights, they can effectively set and achieve their financial goals. This includes managing day-to-day finances such as rent, groceries, and utilities, as well as following essential best practices, like sticking to a budget and staying out of debt.

For financial wellness initiatives to be successful, they should have a mix of financial literacy and competency components. Financial literacy involves understanding how money works to make smarter financial decisions. Financial competency, on the other hand, is about putting this knowledge into action to improve financial stability.

What are the benefits of a financial wellness program? 

Offering a tailored support program can help alleviate your people’s money stressors, improving their financial management skills as a result. This can lead to a better work-life balance. 

It can also improve attendance rates and productivity. Employees who feel secure about their finances report having higher levels of engagement.

According to the Bank of America, 82% of employees say their employers should play a role in supporting their financial wellness. If you offer such a program, this shows a genuine commitment to your employees’ wellbeing, and cultivates a sense of loyalty and appreciation among your people. This, in turn, can help boost your recruitment and retention.

How to set up a financial wellness program

As a starting point, consider distributing an anonymous questionnaire to get a better sense of what matters most to your employees, finance-wise. This will ensure that you’re offering value and investing in resources that they genuinely care about, and which actually provide value.

Ask your employees what topics they’re interested in learning about and how they would like to engage. For instance, some people might want to learn more about how to optimize their taxes, and others may want to know more about investment schemes. Since personal finances can be a sensitive and anxiety-provoking topic, make sure to address these questions delicately. 

Once you have a better understanding of what people are concerned about, you can start putting together an educational package. 

Here are some popular financial wellness tools to consider including in your program.

Financial wellness workshops

Financial wellness workshops offer a direct, straightforward way to educate your employees about personal finances at a low cost. Your company can arrange for external experts to run workshops on different topics, either in-office or digitally. Alternatively, a qualified representative from your company's finance department can fill this role.

Consider offering these sessions in different formats to suit your team’s needs. For example, some workshops could be short “lunch and learn” sessions that focus on key takeaways, whereas others might be recorded webinars that people can access in their own time.

As well as group workshops, you can also explore the option of offering individual financial counseling sessions. These are an excellent benefit, and provide your employees with personalized guidance on whatever financial concerns or goals they have.

What about globally dispersed teams?

If you have team members in different countries, take this into account too. For example, a workshop on maximizing a 401(k) may be helpful for your US-based employees, but will mean nothing to your people in Germany. Similarly, an interactive seminar on household budgeting should be accessible across different time zones, not just one.

To ensure that you are treating all your people fairly, run workshops for each country. If the content is not country-specific, repeat the seminar at different times so that people in other time zones can also engage and ask questions.

Assistance through software and tools

There are many interactive solutions that help employees gain more control over finances and evaluate their progress toward their financial goals. Examples include budget trackers, debt calculators, and retirement dashboards.

There are also automatic savings apps and online services that offer investment guidance and other resources to help employees plan for the future. With instant access to these resources at their fingertips, employees can get quick answers to their questions and concerns. 

When deciding on software and tools for your staff, keep in mind that not all solutions are created equal. Choose simple, user-friendly, and secure tools that employees can access on a computer, tablet, or smartphone. The more convenient these tools are to use, the more likely your employees are to make use of them. 

Again, if you manage a distributed workforce, opt for a solution that accommodates all of your employees’ unique needs.

Benefits and incentives  

In addition to offering educational resources, you can add extra features to your employees’ compensation packages. 

For example, to promote the advantages of saving and investing, consider making employer contributions to your people’s savings plans. This allows them to grow their savings and take a more active role in their financial planning. With auto-enrollment, employees are automatically enrolled at a pre-determined contribution rate. This simplifies the process while still letting them opt out if they choose.

If your company uses direct deposit, you can also implement a split-to-save feature. This allows employees to put a fixed amount of their paycheck into a designated account each pay period.

Look at local tax and insurance schemes in your employees’ countries, too. In the US, for instance, you can encourage people to save and prioritize their health through a Health Savings Account (HSA), while there are specific programs designed to support college funds and student loan repayments.

Remote’s local benefits experts can help you find relevant, potentially suitable benefits in each country you hire in, allowing you to create a genuinely helpful and highly competitive benefits package for all your team members.

Manage your benefits with Remote 

Offering a financial wellness program is a great way to boost employee satisfaction and engagement. It can also help your company stand out in competitive hiring markets. 

Whether your workforce is domestic, global, or both, Remote can help you create a tailored, compliant benefits package that provides access to health insurance, equity incentives, retirement plans, and a whole lot more.

To learn more about how it works — and how Remote can make your entire HR workflow, from hiring to payroll, quick and easy — speak to one of our friendly experts today.

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