Why Financial Wellness is Important in the Workplace?
Did you know that according to a PwC study, 57% of employees experience stress due to their finances? Stress due to personal finance is not new, but with an increasing number of layoffs after the global pandemic, we are hearing more about it. Financial stress doesn't just impact personal lives, it can significantly affect your organisation's success. Here's why you should care about employee financial wellness, and what you can do about it.
What is Employee Financial Wellness?
The traditional focus on employee wellbeing centred on physical and mental health. But leading a healthy lifestyle is difficult when employees worry about money. That's where financial wellness comes in.
Employee financial wellness refers to an employee's overall financial health, including money-related stress and financial knowledge. It considers how an employee's financial wellbeing impacts their productivity, engagement, focus, and morale – all crucial factors for an organisation's success.
Suggested Read: The Relationship Between Employee Wellbeing and Engagement
Financial Wellness Benefits for Employees
Financial stress has a negative impact on both personal and professional lives, ultimately harming your organisation. Here's why addressing employee financial wellness is important:
- Happier Employees: Financial stress can cause a wide range of problems, from anxiety to heart issues. When employees achieve financial wellness, it leads to a happier workforce. There's no doubt financial stress affects health, but it also affects business success.
- Reduced Presenteeism: Presenteeism refers to employees being physically present but mentally absent due to stress. Financial stress can significantly increase presenteeism, costing organisations in the long run.
- Higher Productivity: Highly productive employees are often stress-free and happy. Employees without financial stress can focus more on their work, which increases their productivity. As per the Salary Finance survey, more than 10,000 Americans found out that organisations lose $500 billion a year due to the financial stress of employees.
- Higher Employee Retention: Organisations can significantly increase employee retention by providing financial wellness benefits. Employees are more likely to stay loyal to a workplace where their financial wellness is addressed. It makes them feel valued and fosters a sense of belonging.
Financial Wellness Programs for Employees
Employee financial wellness programs are to help employees manage their finances in a better way and reduce financial stress. It contributes to the overall financial wellbeing of the employees. There are various types of financial wellness programs to educate employees. We have covered some of them below:
Financial Workshops
This is one of the simplest yet most effective ways to educate employees about personal finances. Here you can invite guest speakers to run a workshop in the office to educate employees about budgeting, debt planning, or savings tactics.
Insurance
Financial wellness in the workplace goes beyond just saving and budgeting. A key component for employees is to have a safety net in place for unexpected events. That’s when insurance plans become crucial that provide financial protection in the case of accidents, or illnesses. This will give employees peace of mind, knowing medical bills won't have a negative impact on their financial wellness.
Financial Wellness Tools
Many software solutions help improve employee financial well-being. These tools can provide on-demand financial training, goal planning, debt management, and money management coaching.
Financial Perks
Even though it doesn’t come under the example of employee financial wellness programs still it can be part of it. You can also consider financial support to your employees through various financial perks, helping employees with their student loans, or giving them allowances.
Frequently Asked Questions
Q: What is employee financial wellness?
A: Employee financial wellness refers to overall financial health and the absence of money-related problems of an employee.
Q: What are the five pillars of financial wellness?
A: The five pillars of financial wellness include saving, investing, budgeting, debt and risk management. These pillars are crucial to developing solid money habits and building a strong financial foundation.
Q: What is financial stability for employees?
A: Financial stability for employees allows them to afford quality healthcare services, and better educational opportunities, and lead a life that is free from money-related stress.
Take Care of the Financial Wellness of Employees With CHOYS!
Take Care of the Financial Wellness of Employees With CHOYS! Show your employees you care by offering them the peace of mind that comes with comprehensive group insurance. CHOYS' customisable plans go beyond basic medical coverage. Invest in your team's wellbeing and financial security – get a free quote today and see how CHOYS can help you design a plan that fits your company's needs.
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