by Parker Piscitello-Faye
Updated 11/29/2023 by Kenneth Medford III
As more and more companies embrace new approaches to work-life in 2021, employee benefits are also changing. From four day work weeks to tuition assistance, HR departments across the country are stepping up to support workers after such a difficult two years. Part of that changing equation? Employee financial well-being programs and paying closer attention to financial wellness at work.
These new benefits allows human resource professionals to help their companies support employee financial and professional success. However, for HR departments just starting to do research on these platforms, navigating this new world can get overwhelming, fast.
So, to help both parties better understand what this new benefits program is, we’ve put together an all encompassing resource. We’ll cover employee wellness programs, their benefits, their ROI post-pandemic, and next steps to take to implement them.
Here, you can find out:
1) What Financial Well-being at Work Is
2) What Employee Financial Well-being Programs Are
3) The Benefits of Employee Financial Well-being
4) Why Employee Financial Health is Essential in the Post-Pandemic Workforce
5) How to Determine Which Employee Wellness Program is Right for Your Team
6) What to Consider Before You Implement Financial Well-being Programs
And, if you’re looking for even more, feel free to check out our three guides below. They’re intentionally designed for those ready to take the next step in seeking out these new benefits:
1) Nav.it’s Essential Introduction to Employee Financial Well-Being
2) Nav.it’s Guide to Emotional & Financial Fitness Solutions
3) Nav.it’s Ultimate Guide to Employer Financial Well-Being Programs
What is Financial Well-being at Work?
We’re so glad you asked.
Financial Well-Being describes an approach to wellness that takes into account that how you choose to spend, save, and budget your money is influenced by who you are and how you feel. Instead of shirking from money’s impact on our entire (emotional, mental, and physical) selves, we embrace it. Promoting financial health in the workplace means taking a holistic approach to managing your personal finances. It can also mean learning more about your financial identity.
Facilitating financial well-being can look like:
- Paying close attention to how spending and saving impact your stress levels and emotions
- Remembering that who you are impacts how you spend
- Developing better, sustainable money habits to meet both your needs and goals
- Budgeting in a way that makes sense to you
- Engaging with others to remember that personal finance isn’t a competition
Post-pandemic, with so many Americans working from home, a Great Resignation, and companies paying more attention to burnout, business leaders are facilitating employee wellness at work. By investing in financial wellness programs (see below for more on those), employers are hoping to reap the benefit of having less stressed, more engaged, and more financially resilient and prepared employees. Feel free to check out our pulse article on What Company Leaders Need to Know about Employee Financial Well-Being for more on what promoting financial wellness in the workplace looks like.
One last note: financial well-being at work is not about getting rich fast. It also doesn’t mean showing teams how to use a one-size-fits-all budget. Instead, these programs help stressed out employees learn how to make more mindful decisions with their money.
What Are Employee Financial Well-being Programs?
In some ways, employee wellness programs are exactly what they sound like. These are platforms designed to help teams develop better, healthier money habits. They also support employees as they improve upon or pursue their financial well-being.
Yet, because of how popular employee wellness has become, the definition of the terms “financial well-being programs,” “employee wellness programs,” and “financial wellness programs” has expanded. Now, there are many different types of offerings for HR professionals that specialize in a range of solutions. Check out some of the most popular options below.
Popular Financial Wellness Program Types:
Guides→ These programs offer resources with the goal of educating customers about how to manage their personal finances. These resources vary in the form of videos, paper or digital pamphlets, or articles.
Interactive training → A little more engaging than an educational resource, these platforms train users to manage their own personal finances through an interactive tool (typically a webportal or app) or through in-person workshops with an expert.
Tracking and monitoring programs → Tools like Nav.it help employees recognize their spending and saving habits (and, if they’re good, how they feel about them). By giving users the ability to recognize how they spend, save, and pay down debt, these tools empower employees to manage their own finances and set budgeting plans that reflect their lifestyles.
Company engagement→ Some platforms incentivize employees through company-wide competitions, awards, or events, promoting financial wellness in the workplace through engagement.
Financial experts→ Some companies have partnered with financial experts to offer advice or counseling over the phone, in chat rooms, via email, or in workshop sessions throughout the year.
Holistic approaches→ Finally, holistic approaches to financial well-being incorporate a variety of features (including emotional tracking, financial resources, incentive and engagement tools) to improve employee financial literacy, help employees’ mental health, and increase profits. These can be apps, portals, or physical resources and, ideally, they meet most (if not all) of employees’ well-being needs at once.
For more on the types of programs out there, including their pros and cons, check out Nav.it’s Ultimate Guide to Employer Financial Well-Being Programs.
What are the Benefits of Employee Financial Well-being Programs?
Below, we’ve detailed some of the most common benefits of seeking out a financial wellness program. However, keep in mind that each HR professional and employee will go about promoting financial wellness in the workplace for their own combination of reasons.
Stress and Health Related Benefits
Many human resources departments choose to invest in their employees’ financial health because of their desire to boost wellness in the workplace. Indeed, mitigating financial stress isn’t just a worthwhile process on its own; doing so can help improve mental and physical health.
Financial Well-being Programs:
- Prevent financial stress.
76% of our users have reported less financial stress since using Nav.it. Better yet, since the majority of Americans rank finances as their top stressor, reducing financial stress means decreasing stress as a whole.
- Support employees’ mental health.
About 40% of consumers who have had credit card debt said it affected their general happiness. One-third said it negatively affected their standard of living, and 1 in 5 said it harmed their health. Helping employees manage their personal finances is a solid step in the right direction for human resources departments concerned about their teams’ mental health.
- Help employees avoid physical consequences of financial stress.
72% of Americans stress over money, even if only a little. That prolonged stress can negatively impact their sleep, self-esteem, and even their energy levels. Bottom line, healthier finances means healthier people.
Workplace-Related Benefits of Financial Health Programs
Financial wellness programs have also demonstrated a substantial ROI for HR departments and, thus, their companies. By boosting productivity, reducing turnover, and supporting company culture, these programs can improve your bottom line. One important note before you dive in: the annual cost of financial stress to the employer in lost productivity and absenteeism per employee is a staggering $3,922!
Consequently, employers are working to get that nearly $4K back by:
Boosting performance and productivity.
We wrote an article on Why Employee Financial Well-being Has Everything to do with Performance if you are looking for more specifics. But, the facts are that: 22% of employees report that their productivity at work has been negatively impacted by their financial worries. In fact, 43% of workers spend time on their finances at work. HR professionals can boost their company’s performance and productivity by investing in financial wellness programs.
Drastically reducing turnover.
72% of employees whose financial stress increased due to the pandemic would be interested in working for a company that cares more about their financial well-being. Preventing money worries helps employers, and HR specifically, avoid turnover (and the costs that come with it).
Improving their company’s culture.
Financially stressed employees are 9x more likely to have poor coworker relationships. This can be a nightmare for human resources as they try to mitigate workplace conflicts. This turns an already stressful situation into a sense of dread when thinking about work.
Other Essential Benefits of A Financial Wellness Program
To promote equal access to financial well-being and information.
45% of Black responders, 40% of Hispanic responders, 26% of Asian American responders, and 44% of “Other” responders agreed with the statement “I have too much debt right now” compared to 35% of white responders.
Only 55% of men and 29% of women would be able to meet their basic financial needs if they were out of work for an extended period.
To help your employees plan for their future.
38% of employees have saved less than $1,000 to cover unexpected expenses.
For more on the benefits of financial wellness programs, check out Nav.it’s Nav.it’s Essential Introduction to Employee Financial Well-Being. The resource is complete with more statistics on the benefits, a list of top 10 ways promoting financial wellness in the workplace can help your company, and what to keep in mind as you begin your search.
Post-Pandemic Employee Financial Well-being
There are so many reasons to pursue a financial wellness program after COVID-19 that we wrote a whole article on it. You can read that here: 5 Reasons to Pursue Employee Financial Well-Being Post-Covid
But, in brief, HR departments should consider supporting their employees’ financial health now because of what a difficult two years it has been emotionally, psychologically, physically, and financially.
60% of employees say they’re stressed about their finances which is even higher than during the pandemic. Now more than ever, employers and human resources need to work to combat the financial stress these employees are experiencing.
Furthermore, as we grapple with a Great Resignation, human resources will benefit immensely from giving themselves an edge over their competitors. According to a study by ADP, 75% of employees would be attracted to work at a company that cares more about their financial well-being. Those who do not invest may lose, and fail to attract, talent in the years ahead. As a result, HR professionals will have to deal with a two-pronged assault on their day-to-day duties as they try to retain and attract workers.
Lastly, as leaders debate remaining remote or returning to the office, employee wellness programs stand to unite a hybrid workforce. Many include community and engagement features, and can help their employers collect aggregated insight into their employees’ well-being, and take steps to improve it.
How to Determine Which Employee Wellness Program is Right for Your Team
Ready to take the next step in promoting financial wellness in the workplace? Fantastic.
It’s completely normal to doubt where, and how, to get started. At Nav.it, we don’t think you can solve a problem (whether it’s your own overspending or your employees’ financial stress) without knowing what you’re up against. This is why we recommend HR first run a survey of their employees. With a survey (or even multiple surveys), you’ll better understand the challenges before conquering it.
To advise HR departments on how to collect insight, we’ve written a guide on How to Create the Perfect Employee Financial Well-Being Survey.
The key takeaways? Consider your goals throughout the process, think about the past and future (not just the present), and keep it brief. Discuss what you hope to gain from the survey before you send it out. To ensure you get the information and data you need, stick to multiple choice questions that yield quantitative results.
After gathering insight, feel free to use our decision flowchart (below) to guide your decision. Our Ultimate Guide to Employer Financial Well-Being Programs also includes tons of considerations to ease your decision making. It’s complete with a final checklist of questions to contemplate before you sign your company up.
What to Consider Before You Implement a Financial Well-being Program
If you have done your due diligence, collected insight, and made a program decision, you may feel like your work is done. But, before you close this tab and give yourself a pat on the back, keep in mind the following.
1. You can demo programs.
Before committing or signing an agreement with a financial wellness platform, check to see if they have a trial program. Even if you only have a portion of your employees partake in it, a demo will give you actual insight into what works and doesn’t work for your team. Also, don’t be afraid to ask to trial a program during discussions (if doing so isn’t listed as an option on the website).
2. Definitions of “holistic” and even “financial well-being” may vary.
Keep in mind that your definition of “holistic” or “wellness” may not match that of different programs. They each have their own set of definitions and consider well-being to be influenced by different factors. Look and ask for clear definitions to make sure their program will meet your needs.
3. Where your money (and data) is going
This may seem obvious, but as you purchase or subscribe to a financial wellness program, consider, of course, what you’re paying for. Is it content? Is it access to an expert? Useful features? Equally important, consider what you aren’t paying for. The company you decide to go with will have access to sensitive information on your employees; make sure it stays in the right hands. Confirm that the data they gather will be kept safe and not sold.
4. You should have a long-term plan (and reassess it often).
Finally, while you may be tempted to walk away from a program after you have set it up or consider your team’s financial challenges solved, don’t. You need to keep tabs on the program. Be sure to frequently reassess its influence to effectively go about promoting financial wellness in the workplace. Set a time (maybe in a month or two) to do a deep dive into what the program has and hasn’t offered. Then, assess its effectiveness. As an HR professional, your employees and company are counting on you.
Conclusions
We hope this all-encompassing resource helped you develop a better sense of what financial well-being at work is, how you can promote it, and how you can best navigate the program landscape. As you continue to research this important new benefits program, return to this guide or venture over to our Nav.it at Work site.
Also feel free to send us an email (at maia@nav.it) if you have specific questions about financial well-being at work, its potential benefits, and the work we do at Nav.it to help our users, and employees, develop better money habits.
By: Parker Piscitello-Fay
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