Your Complete Guide to Financial Wellness Programs for Employees
Employee financial wellness programs have been popular for the last five years, but it’s so much deeper than a simple financial literacy program. Workplace financial wellness programs can add tons of value to the employee experience. Not only can they impact retention, a huge problem right now, but they can also encourage healthy habits that will prepare employees for most financial problems they will face in life. But best of all, they will help your employees face the retirement crisis head on. It’s not too late for most employees to get started on their retirement planning journey. As an HR professional you know how important it is to sell your employees on a program, so we’ll show you how employee financial wellness programs benefit everyone.
What is Employee Financial Wellness?
Employee financial wellness is a general term to describe programming aimed at alieving financial stress for employees. Employees are faced with many financial challenges like saving for retirement, planning for large purchases, managing debt, and childcare expenses – just to name a few. Financial wellness programming can help educate and guide employees to the best possible course of action. Financial wellness is a holistic approach to financial well-being. It evolved from financial literacy and took that style and made it more personalized and custom to the individual’s journey. Today participants expect guidance that is tailored to their needs, as opposed to a general pamphlet on financial health.
Is Financial Wellness the Same as Financial Literacy?
While there are aspects of the financial literacy movement that have carried over into financial wellness, they are not the same thing. Financial literacy is focused on detailed education on understanding financial terms and basic financial concepts. While this type of education has its value, in and of itself it isn’t enough to move the needle on someone’s financial health. Most Americans can define simple financial terms, but this doesn’t translate to financial health. Financial wellness programming turns financial literacy up a notch and helps participants apply this knowledge to their own financial life.
What Is An Employee Financial Wellness Program?
Employee financial wellness programs in the workplace have become very popular in the last few years and can range from online courses to in-person meetings to a helpline. Some wellness programs are hyper focused on one topic like paying off debt, while others take a more holistic approach. Still, others are tied to retirement plans so they are more focused on retirement contributions and education. There isn’t a wrong way to do financial wellness programming in the workplace, but there are programs that will provide better guidance and results based on their service and support options.
What Are The Benefits Of Employee Financial Wellness Programs?
While all financial wellness programs bring some value, not all financial wellness programs are created equal. There are a few key elements to look for in a high quality program. You want a program that meets your employees where they are. Additionally you want a program that gives them a full program to follow based on where they are starting from. Simply dumping resource materials on their lap isn’t enough. Most people aren’t dedicated enough to sift through mounds of materials to find the exact information they need. Instead, provide them with a program that assesses where they are, provides them with the tools they need to complete the next steps, and that follows them along their journey to answer questions and provide accountability.
If you select a high quality financial wellness program for employees the benefits to the employee are clear, but what about for the employer? There are a myriad of benefits available to the employer. Most importantly it makes you, the employer, look like you care about your employees. Providing a financial wellness program can be viewed as a “nice to have” but in our changing world it’s becoming the standard and you don’t want to be left out. A quality financial wellness program will address your employees’ stress and distraction level. This means higher productivity and better retention rates. If employees’ personal finances are in order they are less likely to move to another company for a small raise or an extra dollar an hour. Financial stability is key to career stability.
How is Your Money Line different from other financial wellness programs? YML is a unique solution that not only covers all necessary topics but pairs participants with a financial guide and a personalized online dashboard. Our financial guides are either Certified Financial Planners® or Accredited Financial Counselors® and are trained in our proprietary empathy program. We don’t shame your beginnings, and we want participants to feel reassured when they call us. Our mobile-friendly dashboard allows participants to create their own profile to fill out calculators, use our tools, read articles, watch video-based courses, download guidebooks, and select what topics they are most interested in. From their dashboard they can also directly chat, call, email, or schedule an appointment with one of our guides. Your employees are facing many challenges in today’s world. We add new resources to our dashboard weekly to ensure every topic is covered, including breaking news and current financial events.
But before we cover more about Your Money Line, let’s dive into more about the benefits of financial wellness programming for employees.
The Benefits for Your Employees
Here’s a summary of everything your employees get with our financial wellness programming:
- Personalized guide on their journey
- Plan for paying off student loans
- Guidance through the Public Service Loan Forgiveness program
- Determining their financial stability through our Stability Academy
- Plan for paying off debt
- Guide for building a budget
- Understanding of what they need in retirement
- Calculator for determining net worth
- Help determining the best retirement contribution level
- Primer on investing and retirement
- Resources for understanding different mortgage types
- Confidence in planning to buy a home
- Calculator for determining Power Percentage®
- How to save for kids’ college education
- Assistance on how to budget on a variable or commission income
- Aged based guidance for 20s, 30s, 40s, 50s, 60s, and beyond
- Understanding the value of Health Savings Accounts (HSAs)
- How to budget for a new baby
- How to get through tough times
- Evaluating car payment plans to determine the best fit
- Navigating a divorce or other major life transitions
- Assessment to determine if you should rent or buy a home
- Best practices for those just starting out
- Special program designed just for Executives
The Benefits for Employers
- Increased retirement contributions
- Reduced debt burden for employees
- Assistance with the Public Service Loan Forgiveness program which can forgive tens of thousands of student loan debt for your employees
- A complementary benefit to your 401k plan, where they support retirement investments YML supports everything up to retirement
- A complementary benefit to your Employee Assistance Program, our experts will help participants with the financial ramifications of mental health issues but then can forward them to your EAP
- Higher retention rates related to financially stressed employees who are able to get the help they need before making a job switch
- Reduced financial stress for your employees which leads to higher productivity
- A resource and guide for any and all financial questions your employees may have
- A dedicated program for Executives and their unique financial needs
- More than just financial literacy, YML takes your employees on a customized journey
- Individual support for your unique employees
- Experts with certifications such as CFP® and Accredited Financial Counselor®
- Automated marketing campaign to engage your workforce so you don’t have to spend the time creating marketing materials
- A dedicated Client Success Manager is assigned to each account to guide you through the launch process, teach all the engagement tips and tricks you need to know, and help you view your reports
- Reports available on demand for dashboard and financial guide engagement
- The knowledge that you are providing your employees with a holistic benefits experience!
What Are The Different Types Of Company Financial Wellness Programs For Employees?
There are quite a few different types of corporate financial wellness programs available. In order to make the best decision for your employees, let’s walk through all the options you have available to you and your team. We’ll describe the different types of company financial wellness programs and then let you know the pros and cons of each type. You’ll be able to use this as a guide for selecting the right type of corporate financial wellness program for your team.
Financial Literacy Program
Financial literacy was all the rage 10-15 years ago. If you’ve ever heard anyone say, “why didn’t I learn this in high school?” about taxes, budgeting, or student loans then you understand where the financial literacy movement originated. Financial literacy was the answer to training, teaching, and guiding employees to basic definitions of financial terms that they didn’t learn in high school or college. This type of education is super important. If you don’t know what a 401k is, you are unlikely to use one. By teaching your employees basic financial information you are giving them the information they need to start their financial journey. But that’s just it, it’s a start. Financial literacy isn’t a true financial wellness program. Most financial literacy programs involve passing out brochures, booklets, books, or digital learning materials. While this is still better than nothing, this isn’t a program that teaches healthy habits or pushes your employees to follow a program. It’s simply educational resources. This means it’s typically a very affordable and nice option for smaller businesses. Larger organizations will likely find that it will be hard to get engagement or results out of such a simple solution.
Free 401k or Retirement Plan Programs
If you provide a 401k or 403b retirement plan option for your employees you are doing the right thing for your employees! The retirement crisis is real and if your employees have an option to save for retirement via their paycheck they are more likely to take advantage of the option, especially if you offer a match. Every retirement plan has options for your participants to contact the retirement company to ask any questions they may have about their plan or to discuss how they want their money invested. This is a great option for employees who want to be more involved in their retirement planning. Some retirement plan companies will offer additional financial wellness services. On this surface this sounds great. It sounds like an all in one solution, both retirement and financial wellness all in one. While this may work for some companies, most will find that the financial wellness options are limited. The point of a retirement plan company is to drive contributions and all their resources will be geared toward this. While this isn’t necessarily a bad thing, many Americans aren’t contributing to their retirement plans because they don’t have the extra funds to do so. If your employees are living in debt or paycheck-to-paycheck talking to a retirement plan advisor won’t do them much good. They need to talk to someone who is willing and able to start from the beginning and guide them to a healthier financial life and eventually to retirement contributions. Free is always hard to compete with, but the benefits of a true corporate financial wellness program are worth the cost.
Employer Matching Programs
An employer matching program refers to a match made by the employer to the amount contributed by the employee to their employer-sponsored retirement plan. This matching program often has parameters, for example a 1 to 1 match up to a certain percentage or a match made only if an employee contributes a certain amount. An employer match is super important for incentivizing employees to contribute to their retirement plan. This type of benefit is often referred to as deferred compensation. This type of program is popular with employees, but they don’t quite qualify as a corporate financial wellness program.
Another type of benefit that falls into the category of related to finances but not quite a financial wellness program is anything insurance related. All types of insurance benefits are important for employee retention and satisfaction, but they don’t quite qualify as a financial wellness program. Though they do benefit employees financially and this is an important part of holistic financial wellness strategy.
Financial Assistance Programs
Employee assistance programs are an awesome way to help employees with all types of issues from mental health, to assistance with student loans, and so much more. Some employee assistance programs do offer limited financial wellness programming, but most often they tend to guide employees through health problems. There are financial assistance programs sponsored by employers that can offer grants, loans, and student loan assistance. These are most often related to key problems faced by your employees.
Your Money Line
Your Money Line is the exact kind of financial wellness program we recommend for a holistic financial benefit. From our detailed dashboard experience that guides employees through an assessment to determine their financial stability level to the many courses, guides, and tools options – our online experience is a great mix of personalized and comprehensive. Our dedicated financial guides offer the next level of full-service availability. Open 12 hours a day, 5 days a week and available via phone, email, chat, or a scheduled appointment, our staff are more than just financial experts. While they hold the necessary designations such as CFP® and Accredited Financial Counselor®, additionally our guides are trained in our proprietary empathy program. We believe that empathy is the foundation of great customer service. Especially when it comes to such a touchy and sensitive topic like personal finances. We want participants to feel confident that when they call in they’ll not only have a comfortable experience but that our guides won’t sell them anything and all their private data will be kept confidential from their employer. Learn more about Your Money Line right here.
What Should an Ideal Financial Wellness Program Include?
An ideal financial wellness program for employees includes a few key elements. Guidance, expertise, communication, and quality are the keys to an effective financial wellness program. Guidance means that the program you choose doesn’t dump information at your employees’ feet, instead it walks them through a program. Expertise is key when dealing with finances because you never want to be responsible for promoting inaccurate information to your employees. Communication is vital to a financial wellness program because if your employees don’t hear about it there is no value. Speaking of value, quality is key. You want to select a quality program that values your employees as much as you.
Why it Matters
You’ve made it this far and it’s clear you care about your people. You take your responsibilities to your team as seriously as you can. Financial wellness programming can make a huge impact on your business, your team, and your life. Financial stability isn’t a guarantee it’s something that is worked for step by step and by taking that step toward a financial wellness program for your people you are giving them the tools to make the most of their personal finances. This impacts retention, productivity, and contribution numbers at work, but even more important you set your employees up for long term success. To learn more about how Your Money Line can help you achieve these goals, contact us here today!