Employee financial wellness programs: Benefits & tips

Content Type: Article

Promoting peace of mind for your employees.

A healthy and engaged workforce is essential to any company’s success. What could your organization be doing to further promote the well-being or your employees?

Offering your team a financial wellness program can help relieve a common problem that may be keeping your employees up at night: money worries.

Many companies offer their employees wellness programs that are designed to encourage behaviors promoting physical and mental health. “But we are doing ourselves a disservice if we don’t include financial well-being, too,” says Jan Walton, business services strategy and incentive compensation manager at Regions. “At Regions, we think of financial well-being as the ability of an individual to live within their means and manage their money in a way that gives them peace of mind.”

Growing financial stress

The importance of financial wellness programs has never been greater, says Walton. “Everybody is more stressed financially,” she says, noting the recent rise in the cost of consumer goods ranging from groceries to automobiles. Many Americans are struggling with their personal finances, which weighs heavily on their psyches.

In a CNBC survey from September 2023, nearly three-quarters of working Americans (74%) said they felt stressed about their personal finances these days, and more than half (61%) reported they live “paycheck to paycheck.”

And thinking these issues are only a concern for lower-wage workers would be misleading. Employees who earn more aren’t exempt from financial stress.

The goals of an employee financial wellness plan

A growing number of U.S. companies have recognized that their employees are struggling with money concerns and responded by implementing a variety of financial wellness programs. Walton says an effective and comprehensive financial wellness program should address four essential topics:

Spending: How to manage day-to-day expenses by creating and sticking to a budget.
Saving: Setting aside money for long-term goals, as well as unexpected costs.
Borrowing: Understanding and managing debt and using it to your advantage.
Planning: Setting goals and designing a blueprint for achieving them, as well as taking steps to protect your money, such as having adequate health and property insurance.

Creating your financial wellness program

A valuable first step when deciding what elements to include as part of your company’s financial wellness program is to survey the target audience—your employees—about their money concerns. What information and assistance would help them feel less anxious about their personal finances? “You have to understand the needs of your associates—that’s critical,” says Walton. One way to measure the success of a financial wellness program is to repeat the survey annually to quantify the impact it’s having.

Financial wellness programs are typically overseen by a company’s human resources department and can be administered in a variety of formats. Educational materials and tools such as retirement-planning calculators can be made available online. You might also offer webinars or podcasts that demystify important topics such as how to invest in a 529 plan to save for a child’s college education. However, Walton believes there’s also an important role for in-person education. For example, consider holding “lunch and learn” sessions on critical subjects such as understanding a credit report or how to save for a new home.

A win for employees and employers

The cost of implementing a financial wellness program will depend on its scope and offerings but is not prohibitively expensive and can have significant benefits for both employees and the company.

“When you invest in a financial wellness program, it’s going to boost the overall well-being of your employees,” Walton says. Workers who participate in these programs develop what she calls “financial confidence,” or a sense they have a plan in place to meet their short- and long-term money needs. Relief from the burden of worrying about how to pay for a child’s education or even next month’s electric bill can help reduce chronic stress, which has been shown to cause or worsen many health problems.

What’s more, a healthy employee who isn’t stressed out about money will not only miss fewer workdays, but is likely to have a more upbeat attitude and be more productive. “Stress is a morale killer. And if I’m not worried about my finances, then I’m not distracted and I can be more engaged at work,” says Walton. Having a financial wellness program in place can even help employers recruit new prospects and increase employee retention, she adds. Promoting financial confidence in the workplace, says Walton, “is a win for employees and the employer.”