Tuesday, May 29, 2018

4 Key Benefits of a Strong Financial Wellness Program

Financial wellness is an increasingly popular topic, but there is no consensus about the value of financial wellness programs in the workplace. While clear advantages and perceived value have been identified, several obstacles remain.

In Assessing the Merits and Challenges of Financial Wellness, SBS evaluates whether financial wellness programs are a wise choice and welcome addition to the traditional employee benefits package.

To read more about the key themes that emerged from the financial wellness research, download Assessing the Merits and Challenges of Financial Wellness.

Why is Financial Wellness Important to Plan Sponsors?

When designed properly, financial wellness programs can help employers enhance their benefits packages and realize significant cost savings by helping employees retire on time, be more productive, and enjoy better health.

  1. Recruitment and Retention - Employers are constantly competing to attract and retain talent. Employees, especially millennials, seek valued benefits from their employers. In a report by PricewaterhouseCoopers (PwC), a survey of 1,600 workers found that 76% of millennials say they have used and value the services their employer provides to assist them with their personal finances, and 62% say their loyalty to their company is influenced by how much the company cares about their financial well-being. Financial wellness programs are seen as a desirable benefit that can minimize turnover and foster loyalty. Many employers believe “it’s the right thing to do.” 
  2. Enhanced Productivity - Employees who are stressed about their finances are more likely to be distracted at work, spend time at work dealing with financial matters, and more likely to miss work on account of their personal financial issues. Research shows that financial stress can adversely affect physical health, as well as productivity. Not surprisingly, employees who are stressed about their finances are also more inclined to cite health issues caused by financial stress. Financial wellness programs can produce a more engaged, focused, and healthier workforce. 
  3. Retire on Time - Workforce management aims at preparing participants to retire on time. A lack of retirement readiness may cause some employees to “retire on the job” and become disengaged. Delayed retirement can also result in turnover among younger employees who are unable to realize career progression. Financial wellness programs can enhance retirement readiness and help organizations manage their pipeline of talent. 
  4. Cost Savings - Determining the true value of a financial wellness program can be elusive, but studies have shown that a well-constructed program may help reduce healthcare costs, expenses associated with delayed retirement, and costs associated with recruiting, retaining, and engaging employees. 

How Can SBS Help?

As a thought leader on financial wellness, we can help you determine if your organization would be a good candidate for a financial wellness program and help you navigate your options. Perhaps it makes sense for you to leverage the resources offered by your retirement plan record-keeper; or, perhaps you would be better served hiring an independent financial wellness vendor. We can share our expertise and guide you through the process of implementing and monitoring your financial wellness program.

To learn more about financial wellness, or to begin talking to a retirement plan advisor, please get in touch by email or by calling (855) 882-9177.

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