February, 2018

National Financial Literacy Strategy Update: Workplace Financial Literacy

by: CLHIA Staff

The Financial Consumer Agency of Canada (FCAC) is continuing its work to help Canadians develop the knowledge, skills, and confidence to make responsible financial decisions. As year three of its five year-mandate continues, the National Strategy for Financial Literacy in Canada has shifted its focus to workplace financial literacy.

The FCAC hosted its fifth National Conference on Financial Literacy on November 1-3, 2017 in Montreal, Quebec. At the conference, a representative from the International Foundation of Employee Benefit Plans (IFEBP) presented the findings of the IFEBP’s research related to workplace financial education and well-being.

In January 2016, the IFEBP had surveyed member organizations (corporations, multiemployer trust funds, public employers) across the United States and Canada on the various types of retirement and financial education offerings they provide to their employees and participants.

It found that personal financial issues have a significant impact on the overall job performance of participants. Financial challenges create stress and an inability for employees to focus on their work. They also impact their physical health and increase absenteeism rates.

However, it was noted that financial education in the workplace is still a new area of development. The results of the survey found that:
• Two in five respondents feel their only responsibilities for financial education are to educate their participants on pension and benefit options and encourage retirement savings.
• One-third of the organizations offering financial education just started offering it in the past five years.
• Only 14% of organizations have a budget for financial education, but an additional 25% are considering adding one.
• Only one in five organizations have assessed which topics participants need most.

What was also interesting to note is that the organizations surveyed indicated the biggest obstacle to providing financial literacy is a lack of interest among employees.

In order for a financial wellness program in the workplace to be successful, the FCAC recommended five best practices for employers:
• Make financial education a commitment and be patient;
• Know the employee population;
• Diversify topics and formats;
• Customize and personalize education; and
• Increase accessibility and inclusion.

The FCAC also offers free programs, tools, and resources on its website to help employers get started on offering financial education to their employees. There you will find:
• Free financial calculators to share with employees;
• Marketing material, such as banners and posters for the workplace; and
• Free workshops employers can share with employees.

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