How can employers help create financial wellness?
by: Joan Weir, Director of Health and Disability Policy
Why should employers care about their employees’ financial wellness?
Lots has changed over the last few years. Employers are much more aware that financial issues can be brought into the workplace in the forms of stress, lost productivity, absenteeism, poor relationships in the workplace.
Increasingly, employers recognize that they have a responsibility to their employees with respect to financial wellness. Employers decide on payscale, what benefits may be made available, annual increases (or not) and the composition of any pension plan made available. These are all key determinants into whether their employee feels financially secure.
Being financially well helps to keep employees physically and mentally well. How, well excessive long-term stress can lead to other chronic diseases such as high blood pressure, overeating/obesity, diabetes as well as other health issues.
What is a financial wellness strategy?
If you, as an employer, want to start adding programming around financial wellness to your overall wellness program, start by measuring employees’ financial wellness today. Establish key metrics before developing a program.
Understand what the ‘need’ is, and this will certainly differ given your employee age range. Is it managing/paying down debt? Is it funding education for the children? Or saving for retirement and understanding how much money is needed?
An employer should develop or put in place a variety of tools to assist with the need. Many insurers have already have developed communications, calculators, and presentations that can be provided to employers.
Make sure that your financial wellness strategy integrates well with your overall wellness offering.
What does a good program look like?
A good program should be broad enough that it includes tools and programming designed for all stages of life. Ensure your program is about more than pension and retirement planning. Some examples include managing household debt, budgeting, handling short-term financial priorities.
Know that financial health is an objective measure whereas financial wellbeing is more of a subjective measure. However, growing evidence demonstrates that the objective of improving financial literacy impacts health over the long term. A nice return on investment.