Financial Wellness is No Longer a Nice to Have--Here’s Why
Jeff Clark, CFP®
Throughout 2020, a growing number of employers realized the critical role of financial wellness in their employees’ well-being-- and it’s positive impact on productivity, engagement, and the overall employee experience. With the new year, it’s even more important now for employers to prioritize offering a financial wellness program that meets their employees’ needs.
The Impact of the Global Pandemic
The COVID-19 pandemic highlighted how employee well-being is key to a company’s success. With the shift to remote work, many employers listened to their employees’ needs and made adjustments to their benefits offerings. In a recent industry roundtable hosted by BrightPlan, HR leaders shared how they de-prioritized perks like office lunches and ping pong tables in favor of programs that support the physical, emotional, and financial well-being of employees.
As part of this shift towards employee well-being, financial wellness is no longer a nice-to-have benefit--it is a necessity. In times of crisis, employees in poor financial health are not as productive and engaged-- understandable since financial challenges are a significant cause of stress. Having solid financial habits can go a long way in alleviating that stress. By supporting employees with their financial well-being, both employees and employers benefit and are better set up to weather current and future crises.
The Role of Employers
Previously, employee financial wellness was the sole responsibility of the employee, but today it’s increasingly expected to be an employer-provided benefit. Employers are uniquely positioned to support their employees’ financial well-being as most of an employee’s financial life is tied closely to their employer as the primary source of income and benefits. Employer-sponsored financial wellness has evolved in recent years, we define our approach as Total Financial Wellness, a trusted solution built to lead all employees to financial success on their own terms at every stage of life.
According to a recent report by IDC Research, financial wellness supports a robust employee experience, which in turn drives greater employee engagement, loyalty, and organizational resilience. Also, employees increasingly expect and demand this benefit from their employers. Seventy-two percent of employers surveyed by Prudential saw greater employee demand for financial wellness programs. Our survey reinforces this and found that knowledge workers prioritize financial wellness over traditional benefits like healthcare.
In 2021, we expect financial wellness will continue to be high on the list of benefits that matter most to employees. A financial wellness program in 2021 will give employees the support they need to build a solid foundation for their financial life and future. If you’d like more guidance on where to start, including the requirements of a solid financial wellness program, check out our Buyer’s Guide and accompanying webinar. In 2021, financial wellness is no longer a nice-to-have benefit--it’s a necessity.
