Employee wellness is something that every firm thinks about. As a result, employers are devoting more resources to ensuring their employees’ physical, mental, and emotional well-being so they can deliver their best job. However, there is another sort of wellness that has been disregarded in the past but is increasingly becoming a part of the conversation: financial wellness.
Many businesses are prioritizing financial well-being in the workplace these days. This would not have been a topic of discussion ten years ago. However, in today’s pandemic and competitive world of work, the financial wellness trend has become a buzzword, and employers are under more pressure than ever to support financial wellness for employees.
In this article, we’ll look at why financial wellness is so important for overall health. We’ll also go through some concrete initiatives you can take to promote financial wellness for employees in your organization.
What Is Financial Wellness?
Financial health, also known as financial wellbeing in the workplace, refers to several elements relating to a person’s present financial situation and relationship with money.
The Australian Securities and Investment Commission (ASIC) conducted a poll to measure public opinion on financial wellness. The findings influenced our collective definition of financial wellness for employees, which we’ve provided below:
“Financial wellness” is defined as “being able to fulfill expenditures while still having spare money,” and “being in control of one’s finances,” and “feeling financially secure now and for the future.”
Those who are financially secure have the freedom and ability to meet their immediate and long-term financial needs.
Over time, financial wellness has become increasingly complicated. Employees’ financial health is jeopardized as they have better access to school loans, lines of credit, home purchases, and investments.
The Importance Of Financial Wellbeing
What is the significance of this concept of financial wellness? To grasp the enormity, we must consider how individuals are affected by a lack of financial wellness.
Employee financial well-being has an impact on a company’s bottom line
Financial or money concerns create the most stress in employees, according to a PwC poll conducted last year, and 38 percent of workers report having less than a thousand dollars in savings to deal with unexpected bills.
Financial stress produces emotional stress, which can lead to health problems, as many of us have experienced. As a result, an employee’s entire well-being at the job encompasses their emotional, bodily, and financial well-being in the workplace. When an employee is financially secure, their health is likely to improve, resulting in lower healthcare expenditures for businesses.
Employees that are concerned about their financial situation will perform poorly and leave your company. When employees are financially secure, they are more likely to be loyal to their employer and productive in their jobs.
Providing financial wellness support helps to attract and retain employees
According to another survey, employees now value their mental, physical, and financial well-being in the workplace equally. They, on the other hand, believe they have the least control over their financial situation.
As a result, employers who provide financial wellness programs or support to their employees have a competitive edge in the job market. Offering financial wellness benefits, in other words, can be used as a hiring and retention weapon.
Focus on the importance of financial wellbeing for your employees to improve their financial health.
Is Financial Wellness The Next Big Thing?
Employee mental health has been the main focus of companies’ attention throughout the pandemic, and rightfully so. Employers are paying a high price for poor employee financial wellness, according to a growing body of studies.
According to a 2016 study conducted by the CIPD, 19% of employees have lost sleep stressing over their financial health. According to a recent study, one out of every four workers admits that financial concerns interfere with their ability to perform their job.
Financial security is at the top of employees’ concerns, according to a new employee study.
According to an AMP survey, employees who are concerned about their financial situation take an additional 2.4 sick days per year and spend nearly an hour each week dealing with money issues at work.
Given these figures, it’s evident that financial well-being in the workplace has a major impact on productivity, absenteeism, profit, and other factors.
5 Reasons Why Financial Wellness Benefits Are Worth A Try!
Not only will employees benefit from a comprehensive and tailored financial wellness program, but as an employer, you will undoubtedly reap some benefits as well.
Start with these five important employee financial wellness benefits:
Improved Employee Productivity
Worrying about financial health can be very consuming. It is exhausting for people and takes away their focus.
Employees will lose time on the phone contacting creditors daily. They’ll require additional holiday leave. They’ll be preoccupied with their financial situation.
One of the most significant purposes of offering financial wellness benefits to your employees is productivity improvement. Employees will save time by not having to worry about bills and other concerns.
Increase In Employee Satisfaction
When employees have access to financial programs, they report higher levels of job satisfaction. Employees who are prepared for economic calamities are more engaged and productive. It’s because they don’t have to be concerned about their long-term financial health.
Greater Employee Retention
You’re more likely to offer employee benefits that help them manage their money if you use financial wellness programs. This will benefit them in the long term while also allowing you to keep your valued assets.
Employees will be more willing to stay with your company if they see that they will be given greater support with their finances. This improves your corporate culture while also increasing employee retention.
Strong Employee Recruitment
Competition is fierce in today’s world, and job-hopping is a prevalent financial wellness trend. To mitigate this, firms must provide all employee benefits and perks to retain their top employees.
Employee perks such as health insurance give employees a great sense of security.
You must assist employees’ financial well-being to have a successful recruitment strategy. As a result, the millennials in the organization feel valued. As a result, your company’s recruitment possibilities will improve.
The cost of living has risen dramatically as inflation rates have risen. As a result, even if the work is well-paid, employees find it difficult to make ends meet.
This occurs because most employees do not have a well-thought-out financial strategy for their expenditures. It can also contribute to anxiety, tension, and despair.
However, by teaching your staff about financial wellness, you may help them transform their situation. This will assist them in creating an effective budget for themselves, which will help to improve their financial well-being in the workplace.
As a result, the likelihood of working for another company is greatly reduced, as is absenteeism.
Implementing Financial Wellness For Employees: Final Word
Life can bring a slew of financial difficulties. Supporting your staff during difficult times, on the other hand, will boost your corporate culture and provide plenty of other advantages to your business.
The financial wellness of employees can have a significant impact on other elements of their health as well as their performance outcomes. By investing in their financial well-being, you’re not only helping them in reducing a big weight in their lives, but you’re also supporting your company’s success.
Focusing on employee benefits and how to improve financial health is a fantastic approach to look after your staff while also gaining a competitive edge in the job market. It can take time and effort to put together a plan like this. However, with so much on your plate, you can certainly put out some effort.