AdviceFinances

Financial Wellness in the Workplace

With the ongoing stress many feel about their finances, employers are starting to take note by offering financial wellness programs as part of their benefits package. Since financial situations vary person to person, it’s important to understand what each program offers and how it might benefit your financial future.

 

What are financial wellness programs?

There are a number of different financial wellness programs that are offered to employees that ultimately result in a more pleasant and secure work environment. Studies have shown that offering financial wellness programs not only helps ease stress and anxiety for employees but also leads to increased productivity. Offering these services as a benefit also leads to increased loyalty to the company and less employee turnover.

Employees come from all walks of life, and whether you just graduated from college or are in the midst of planning for retirement, there are various types of financial wellness programs to choose from.

 

Student Loan Assistance

The most common burden a recent college graduate will have is student loans. Employers are beginning to offer programs that not only assist employees with paying off student loans, but also teach them how the programs work. Companies may also put pre-taxed dollars towards helping employees pay off their debt – and if the company does not offer this, then the financial wellness program can focus on options for refinancing.

According to Student Loan Hero, the top five reasons for companies to offer student loan assistance are:

  1. Competitors already offer student loan repayment assistance
  2. The company will save time and money on talent
  3. The benefit may decrease stress and increase productivity
  4. Setting up the benefit won’t take long
  5. Student loan repayment assistance may one day be tax-free

Both employee and employer are able to reap the benefits of student loan assistance, making it an appealing benefit for college graduates entering the workforce.

 

Finance Education

While reviewing important information about your finances, it’s helpful to understand what it all means. Finance education provides employees with a set of skills and knowledge that allows them to make informed and effective decisions. In these programs, employees will learn the ins and outs of common financial terms such as credit cards, budgeting, balance sheets, and income statements, as well as have more in-depth conversations about understanding debt, investing principles, tax laws, and managing money and investments.

 

401(k) & Retirement Plan Education

When thinking of retirement, people often imagine a period of enjoyment and utter relaxation. However, there are a number of steps to take before getting to that point. 401(k) and retirement plan education teaches employees the importance of saving. The program also reviews what the company’s specific plan offers; company matching, investment options, understanding risk tolerance, and establishing retirement goals.

With so many corporations automatically enrolling employees in their retirement plans, educating yourself on the various investment options is an important step to ensuring a secure financial future.

 

Professional Financial Planning

Another option is having a financial professional available to meet with each employee to develop a financial plan. There are numerous questions a financial planner can help employees answer including:

  • What are the employee’s goals, short and long-term?
  • How much should they be saving monthly/annually to meet those goals?
  • How much risk do they need to take to meet those goals?  

Studies show having a written plan increases the likelihood of a positive outcome. According to Forbes, vividly describing your goals in written form is strongly associated with goal success, and people who very vividly describe or picture their goals are anywhere from 1.2 to 1.4 times more likely to successfully accomplish their goals than people who don’t.

In the end, financial wellness programs prove to be an important benefit for both the employee and employer. As more companies adopt these programs, they’ll help improve employee morale and productivity – a win-win for everyone.

 

Guest post courtesy of Laurie E. Ingwersen. Laurie is a Certified Financial Planner™ Practitioner (CFP®), a Chartered Retirement Planning Counselor (CRPC®), a Certified Divorce Financial Analyst (CDFA™), and a Cash Balance Consultant (CBC). As a CRPC®, Laurie’s knowledge is key in assisting clients as she works with them toward a worry-free financial future.  She specializes in insurance and annuities, and can assist in all aspects of retirement and estate planning.
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