- Employers are paying more attention to the causes of employee stress
- Most workers (75%) believe that financial wellness programs are a key benefit (Morgan Stanley)
- Many employers on average offer several financial wellbeing programs
Wellness programs have been around for years. Yet the focus on money-related stress is a new trend.
- A 2019 PwC survey found that 59% of workers cite financial and money matters as the leading cause of stress.
- In a Morgan Stanley study, 78% of workers said financial worry is distracting. Another 37% reported too much debt, and 41% do not have savings to cover expenses for three months.
Companies are seeing the need
A growing number of companies are offering financial wellness programs to reduce stress and help employees optimize their benefits.
The Employee Benefits Research Institute (EBRI) noted that larger firms are more likely to offer financial wellness programs. In its study, 54% of firms were offering financial wellness programs, 12% were starting a program, and 34% were interested.
Improving employee satisfaction with their jobs and reducing overall stress were the top reasons cited for offering wellness programs. Other reasons included employee retention (47%), improved employee use of existing benefits (34%), increased productivity (32%), and recruitment (22%).
Many companies offer multiple programs. EBRI found that employers on average offered 4.7 financial wellbeing programs. The most common programs included retail discounts such as travel and entertainment (72%), tuition reimbursement (69%), and financial planning education (60%). A smaller percentage of employers offered emergency savings accounts, debt management, and student loan aid.
What can plan sponsors do?
Plan sponsors can help educate savers about maximizing the potential of their 401(k) or health savings accounts. Feeling more secure about funding healthcare and future retirement prospects can help to ease a couple of major worries. One survey found that 42% of workers said they would like more information than they currently receive about their benefits programs, so that they can use them more effectively. If the programs succeed in improving employees’ health, it may also lead to lower healthcare expenses before and in retirement.
If an employer is considering which types of programs to offer, they may want to ask their employees. EBRI found that some employers survey their workers, hold focus groups, or conduct a formal needs assessment of their benefits programs.
Education can be delivered online and via social media. Some companies hold meetings for employees with a financial advisor or offer educational seminars and webinars.
As a testament to their importance, the Consumer Financial Protection Bureau, a federal agency, began studying financial wellness programs in 2014.
Overcoming challenges offers upside
Employers need to consider cost and level of interest. Also, success can be difficult to evaluate. Still, employers are finding that financial wellness programs can benefit both workers and the company. Asked to name the top three reasons to offer these programs, 54% of employers said employee satisfaction, with reduced stress (48%) and worker retention (47%) close behind.
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