Financial Wellness Benefits: Now’s The Time for Your Organization to Offer Them
Expanding financial wellness benefits and what that entails for HR
by Elle Mason - October 8th, 2021
Financial wellness benefits are heating up. And in times of unemployment, depleted emergency savings, unprecedented medical costs, a loss of childcare and other COVID-19 related outcomes that resulted in a negative financial impact for workers across the country, it’s not hard to see why! According to research, employee financial stress has doubled since the beginning of the pandemic.
As we all know, the pandemic has changed a lot about work, including employee benefits. For example, the hot employer benefit of the moment is matching emergency savings – and other financial benefits. And in an effort to retain and attract new employees, some employers are adding emergency savings accounts to employee benefit programs to help employees prepare for unexpected expenses. This article will be a guide for HR and employers on why now might be the time to consider expanding financial wellness using a BenAdmin solution.
What are financial wellness benefits?
Typically, as an addition to more traditional benefits, financial wellness benefits and programs are financial support and resources that are more expansive than the standard retirement accounts and investing information. It often includes tangible support in the form of financial assistance, and educational tools, resources, counseling and materials to provide greater understanding and actionable advice about an employee’s specific financial situation, planning and outlook.
And they’re an exceptionally hot topic right now for a number of combined reasons: The Great Resignation that’s forcing employers to get creative with their talent recruitment and retention strategy; the negative financial impact that COVID-19 has caused for people across the globe; and the growing popularity of various wellness programs at work in general. Given the recent focus on mental health and wellness, and given what we know about how financial stress can negatively affect both mental and physical health – it makes sense for financial wellness to become the next priority.
In practice, financial wellness benefits can come in many forms such as:
Enhanced retirement planning including 401(K)s, 403Bs, etc.
Loans or pay advances
Matching emergency savings
Student loan support
Budget counseling or management support
Employee Assistance Programs (EAP) that offer financial resources
Debt management counseling and services
Financial counseling and planning services
Personal finance tools, calculators and apps
Financial education that comes in the form of courses, seminars or otherwise
While determining precisely which benefits are the best for an organization should be determined on a case-by-case basis, according to a 2021 survey by PricewaterhouseCoopers, pandemic financial stress is negatively impacting businesses from a productivity, retention and health perspective. Specifically, amongst employee whose financial stress increased during the pandemic:
45% have reported that finances have been a distraction at work
72% would be attracted to another company that cares more about financial well-being than their current company
57% avoided having a medical issue addressed due to cost
Given that, businesses that begin to expand into financial well-being benefits are going to see benefits ranging from increased productivity, a reduction in the financial stress of their employees, improved health outcomes, and increased employee retention, engagement, satisfaction and organizational commitment.
How can HR can make the case for offering or expanding financial wellness benefits?
Bring the data: Research has given us robust statistics and there are a few things that we know definitively. 1.) Employees are financially stressed. 2.) Employers who offer financial wellness benefits are at a competitive advantage in the search for talent. 3.) Offering financial wellness benefits offers a return-on-investment that impact productivity, retention, commitment and bottom-line. Gathering your key statistics and talking points will allow you to lead with a data-driven argument before discussing the types of benefits you’d like to offer.
Find internal sponsors for it: Ideally, your presentation shouldn’t be the first time that anyone from the organizational leadership team is hearing about this proposal. Finding at least one (but ideally more than one) sponsor to support the proposal will help you build buy-in ahead of your pitch, and allow you to strengthen your proposal by getting other leader’s insight into what could be missing or what considerations you didn’t account for, for example.
Build support around it: Reach out to the employees for a pulse check in the form of a survey or focus group to not only build additional support, but learn exactly what their challenges are and which financial benefits would help them the most. For example, student loan support only makes sense for a worker population experiencing those hardships. By not understanding and accounting for what employees actually need, employers will miss out on a lot of the benefits and make financial investments that ultimately don’t serve or help anyone.
Bring the business benefits to the conversation: Opening your presentation with statistics documenting the need for financial wellness, followed by data and feedback from employees themselves is a strong case – but be sure to highlight the benefits for the business too. Connect the dots between what reduced stress means for business outcomes and why increased engagement and commitment are good for the bottom-line. This will ensure that your presentation and proposal have accounted for every angle.
Now, an already at-capacity HR team might be hesitant to bring in any new benefits that will require even more administration, but GoCo can help.
Benefits - With GoCo, you don’t have to worry about adding new lines of coverage or types of benefits — Admins can easily work with benefits advisors to add additional types of benefits, handle benefits deductions with ease, and run open enrollment 100% digitally. Employees can view potential financial benefits plans and costs at-a-glance, and decide what’s right for them. GoCo’s BenAdmin software empowers employees to make the right choices for their own lives. GoCo also works has native 401K integrations with apps like HumanInterest to make the process even more seamless.