Creating Effective Financial Wellness Programs to Improve Employee Performance
The majority of employees experience financial stress which can cause a chain reaction that negatively impacts both employees and employers.
We’re often told that health is wealth. In the workplace, this means healthier employees are more productive, produce more and better quality output, and are more engaged. All these contribute to higher profitability.
Wellness programs over the past few years have focused on physical well-being and, more recently, mental health. However, looking at employee wellness and satisfaction holistically, employers often miss an important piece of the puzzle: money. In the past year, financial stress among employees has doubled due to the COVID-19 pandemic.
In the bigger strategy to build a happier and healthier workforce, employers should also look at it from the perspective that wealth is health.
Poor Finances = Poor Job Performance
As it turns out, financial wellness significantly impacts employee performance. PwC’s 9th Annual Employee Financial Wellness Survey noted that 58% of employees are stressed about their finances, and among them, 50% admitted that it’s a source of distraction at work.
A different survey by consulting firm Mercer estimates that on average, employees spend 13 hours per month at work worrying about money, which equates to approximately $250 billion in lost wages.
Additionally, the International Foundation of Employee Benefit Plans cited poor physical health, absenteeism, lateness, and low morale as performance barriers brought about by employee money woes.
This underscores the need for employers to offer financial wellness programs. However, only 32% of employees are satisfied with the financial management resources their company provides, with 31% having no access to financial planning resources at work. This creates a lose-lose scenario for both employees and employers and the negative effects even extend to the economy at large.
“It’s important to understand that we’re all in this together. When employees are hurting, it hurts your business and your profit margins. And it hurts our economic growth because the lack of financial wellness has an extreme impact on people’s lives, on their employer’s profitability, the communities they live in, and our nation’s overall economic growth. When someone isn’t financially stable, it limits an individual’s purchasing power and their ability to secure basic needs,” explains Denise Winston, CEO of financial education company Money Starts Here.
The ABC of Financial Wellness Programs
Business leaders need to roll out financial wellness initiatives. Here’s a three-pronged approach that may help companies jumpstart their financial wellness program, summarized as the ABC strategy.
A - Access to Resources and Tools
Go to any mobile app store, and there are hundreds of financial management tools available for download. It’s quite puzzling why businesses don’t utilize technology to equip their employees with the tools and resources they need to manage their finances better.
Of course, workplace financial health programs go beyond these readily available apps. The tools need to be robust and integrated into an overall employee wellness program. Lastly, their impact on employees needs to be traceable and measurable.
For example, CoreHealth partners with comprehensive financial health solutions such as Pro Financial Health, which allow employees to get personalized and adaptive money management strategies based on their needs and goals. Businesses can also use KOFE on the CoreHealth platform which provides unlimited one-on-one financial coaching to employees.
B - Before-the-Crisis Intervention
Simply put, the most successful financial wellness programs are those that are implemented before employees fall into a money dilemma or make an important financial decision. As seen in the PwC survey, 25% of employees only seek financial guidance when they're already neck-deep in money problems.
This preventative aspect of a financial wellness program reinforces the need for 24/7 access to financial tools, resources, and coaching among employees. The most efficient way to achieve this is for business leaders to invest in employee wellness technology that allows employee access at any time and from any permitted device so the employee can take immediate action as soon as they identify a potential money issue.
C - Communication and Community
It’s difficult for anyone to open up about money problems. Business leaders and managers shouldn’t expect their employees to initiate a conversation or ask for help. This is another area where tools and resources that employees can access on their own can be valuable.
Furthermore, employees should also be encouraged to turn to HR as a “safe space” to discuss money issues affecting their performance, and confidentially.
The ROI of Financial Wellness Programs
Financially healthy employees are the building blocks of successful businesses. They are more productive, more engaged, more focused, more loyal, and more likely to produce results that drive business growth.
For years, wellness programs have focused just on physical health. A more holistic approach to workforce wellness that includes financial health has been a long time coming. By providing access to resources and tools, extending assistance before a crisis, and through communication and community formation, business leaders can start a financial wellness program tailored to their employees’ needs.
If you would like to start your own workplace financial wellness program or improve your existing one, contact us today. We will be happy to connect you with the right resources.
About CoreHealth Technologies
CoreHealth Technologies Inc. is a total well-being technology company trusted by global providers to power their health and wellness programs. Our wellness portals help maximize health, engagement and productivity for 3+ million employees worldwide. We believe people are the driving force of organizations and supporting them to make behavior changes to improve employee health is in everyone’s best interest. With the most flexibility, customizations and integrations of any software in its class, CoreHealth’s all-in-one wellness platform helps grow great wellness companies. Simple to sophisticated, based on you. For more information, visit the CoreHealth website.
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