What is employee financial wellness?
A person's overall financial health and the lack of stress linked to money are referred to as their financial wellness. It is the outcome of effective management of personal expenditures.
Employees will experience less stress when they are financially secure, just as they will be more productive and joyful when they are physically well. Enhancing financial wellness among employees may result in healthier workers, fewer absenteeism and attrition rates, more employee satisfaction, and an improved corporate brand.
Benefits of employee financial wellness
Organizations have every motive to seek financially stable personnel. Employers can benefit from employee financial wellness in the following ways:
- Boosted productivity since workers are less preoccupied with money issues.
- Improved organizational labor flow by making it more predictable.
- Increased physical health (people with high levels of financial stress are more prone to sickness).
- Boosted staff retention and engagement.
- Improved retirement options for all workers and career growth possibilities for younger workers.
How do financial issues impact employees?
Why should your organization prioritize employee financial wellness?
Financial strain hurts your workers' personal and professional life and, therefore, your business.
Take into account that 2 out of 5 full-time employees cited rising expenses as their most significant financial stressor, according to the 2022 PWC Employee Financial Wellness Survey. Only 42% of respondents claimed that their pay kept up with the growing cost of living. In addition, 56% of full-time employees are anxious about their money, and one in four are working more jobs than in past years to make ends meet.
Employee financial wellness programs may help employees achieve balance and control over their money, both now and in the future; this benefits both employers and employees, who gain from a more focused, engaged, and productive workforce.
According to a Forbes article, 80% of employers believed that their employees' performance level was harmed by financial stress. Financial stress is causing melancholy, panic attacks, and restless sleep, all of which cost around $500 billion in yearly interruptions combined.
Following are some of the factors that make financial security vital.
Happy, healthy employees
Employees who worry about money might have a wide range of (severe) health problems, from melancholy and anxiety to ulcers and even cardiac difficulties.
In other words, removing your employees' money concerns from the picture will get you one step closer to a more productive and contented staff.
Financial stress eventually impacts the team members and other coworkers and the particular employee's health and morale.
Absence and presenteeism
The Society for Human Resource Management (SHRM) reports that financial stress causes a 34% rise in tardiness and absenteeism. In addition, financially worried people miss nearly twice as many days of work annually as their less stressed coworkers.
Stress over money can also boost presenteeism, the practice of employees reporting for work when physically or psychologically ill. Although employees are physically present at work, presenteeism negatively impacts firms and may be costly.
Loss of productivity
It should be no shock that financial stress lowers workers' productivity since it increases presenteeism, absenteeism, and employee illness.
According to a Salary Finance survey of more than 10,000 Americans, personal financial stress among employees costs US businesses $500 billion annually.
How do you promote employee financial wellness?
Financial wellness initiatives! Now that we have established the importance of financial wellness. How would you go about promoting it?
Programs that assist employees in (better) managing their finances and lowering financial stress are known as employee financial wellness initiatives. They help employees have higher overall financial wellness.
A financial wellness initiative aims to prepare staff members to manage their finances to enhance their well-being. This may be done in various ways, from using a platform that helps employees manage their finances to providing financial counseling and coaching on specific themes. Below are a few examples of employee financial wellness programs.
Consider bringing in frequent guest speakers to provide workshops at work on subjects like budgeting, managing debt, or money-saving strategies. You might also invite someone from your financial department to conduct a session, depending on the size of your business. This approach is straightforward and often affordable.
Another choice is to collaborate with a business specializing in employee financial planning. You may, for instance, choose a partnership that provides your employees with services and knowledge to help them manage their money better at a discount, depending on the amount of money you have at your disposal.
Employ instruments for financial wellbeing
There are numerous software programs out there that promise to help workers' financial situations. These solutions can offer everything from the individualized coaching and on-demand financial advice to targeted training and e-learning to increase the financial literacy of your staff.
Providing financial assistance to your employees can positively affect their financial wellness. This can range from helping someone pay off their debt to providing employees medical aid, fuel allowances, airtime or groceries.
You may get on the right track by following these 6 steps:
- Know your employees' financial situations.
- Examine the requirements for your workers' financial wellness.
- Choose the appropriate financial wellness options for your business.
- Choose a financial wellness program and stick with it.
- Apply and assess your answer
- Adapt your response in light of feedback and analysis
For more information on the National Fund for Workforce Solutions' article about creating your financial wellness strategy.
Including employee financial wellness programs in your HR plans and other corporate benefits is critical. Everyone would benefit from the programs, including the business.
Giving your employees appropriate financial assistance is necessary to ensure they are stable in their finances, healthy, and productive.
Yolanda Chimonyo is a Strategy and Performance Management Consultant at Industrial Psychology Consultants (Pvt) Ltd, a management and human resources consulting firm.
Phone +263 242 481946-48/481950
Visit our website at www.ipcconsultants.com