It’s 2019 and benefits are the name of the game. Gone are the days when companies were elevated in the labor market by a simple retirement plan or comprehensive health insurance. Today employees, particularly those of younger generations, are demanding more comprehensive, creative, and unique fringe benefits.
This article will focus on one of our favorite (and trending) fringe benefits: financial wellness programs.
In addition to perks like a flexible paid time off policies and work from home options, financial wellness programs are swiftly on the rise. Here’s a short guide to understanding financial wellness programs.
What are financial wellness programs?
Financial wellness programs are intended to educate employees by ultimately increasing their financial well being; this can be done in a number of ways from finance counseling, to 401k education, or platforms that assist them in managing money. In a retirement survey, PWC’s found that “U.S. employees still aren’t confident about reaching their long-term goals, and retirement plans continue to serve as a safety valve for more immediate needs. As employees stress over uncertainty regarding healthcare and are pressed to support both aging parents and adult children, employers have an opportunity to help.”
Why would an employer consider offering a financial wellness program you ask? Well, according to the Consumer Financial Protection Bureau, “In the wake of the recession, many employers have seen how financial distress reduces worker productivity, increases absenteeism, and undermines employees’ health.” Employers have the chance to calm employee anxiety and allow them to refocus wholly on work through offering financial wellness programs, which are designed to quell these worries. The CFPB has actually gone so far as to craft a full report on the topic, covering examples of low-cost, high-impact ways to promote financial wellness.
What do financial wellness programs entail?
PWC has defined financial wellness as freedom from financial stress, debt, and worry about unexpected expenses and the freedom to make choices fueled by finances that support them. Their approach entails “strategic plan redesign, along with an increased focus on promoting healthier employee financial behaviors,” something they’ve been working towards by providing unbiased counselors to help employees understand and best use the benefits that PWC offers.
The key to a successful financial wellness program is first determining the specific needs of your employees so that you can more accurately meet those needs. Different workforces will have different financial situations and necessitate different programs.
Who wants this work perk?
It’s probably no surprise that the younger generations (ahem, millennials) are the ones spearheading the demand for financial wellness programs. They grew up in the economic prosperity of the 90’s and graduated from college during a deep economic recession. Therefore, strong finances have always been anything but guaranteed for most millennials. They want all the resources they can to help them plan for their futures, and companies that offer them will have the upper hand when it comes to recruiting young talent.
However, according to a recent survey Zenefits deployed, older generations (employees ages 55 and above) are also highly interested in financial wellness programs. This is presumably because they are heading towards retirement. Regardless of the age of your workforce, the best place to begin is by understanding your employees’ financial needs and proceeding from there.