Financial wellness programs – what success looks like

Financial Wellness Solutions

We’ve talked about the importance of financial wellness to any business environment. Many organizations have recognized how critical it is to have their staff financially secure. They then take the next step of implementing financial wellness programs for their staff.

There’s no question that financial wellness programs are very popular right now. In the US a study by AON Hewitt found that 77% of large to mid size companies offer employees some sort of financial wellness programs.

What happens? Far too often the programs and the staff interest slowly withers and dies.

Why is this? It’s because its one thing to get staff aware of the need for sound money management but taking action is another thing. There’s also a need for employees to be fully financially literate so they understand how to use the tools and are not fearful.

So let’s address what has been shown to work and not work.

What doesn’t work

• One off events or irregular sessions.  Employees need regular sessions to maintain their interest. And all the financial knowledge they’ve accumulated will slowly dissolve if there aren’t regular opportunities to hone and practise it.
• One size fits all information. Your program should be specifically tailored for your employee’s demographic, discipline and financial status. For instance, there’s no point in doing a session on debt reduction for executives when the audience are all lower income workers. It’s less likely to be of value to the employees if they can’t relate to it.

• Services that cost. Anything that means the employees have to contribute their own money whether it be a financial planner or training session.

• Not training employees in financial literacy (sink or swim approach). Making assumptions that employees will all understand the terminology and language of financial investment. Or that they’ll instantly comprehend complex strategies or financial concepts.

• Cross promotion. Wellness programs that are also trying to cross sell products and services to the employees. This will (quite rightly) make the employees sceptical of the program and less likely to take it up.

What does work

• Year round access to consultants or experts. It’s been shown that the take up by employees for proper money management is much greater when they have a one on one session geared to their needs as opposed to occasional group meetings.
• Employer incentive programs. This can take the form of the employer offering to match superannuation contributions. Or else the chance to have shares in the company. This has the double bonus of increasing their investment in the company as well as their productivity.
• Debt reduction plans. This is critical. Debt management and retirement savings go hand in hand.  A tailored plan to help employees to reduce debt based on their personal circumstances and budget (this can tie in with work. For instance the employer can offer them extra hours/ shifts to help them manage debt).
• Investment knowledge. This is another important tool you can give employees. Education about investment risk and strategies will empower them to make informed decisions whether its property investment or blue chip shares.
• Regular reminders of the benefits of retirement savings and debt reduction. If you create a culture where savings and investment are always at the forefront of conversation you’ll be subtly influencing the employees to think in that sphere.

The benefits of financial wellness programs are abundantly clear. Remember that giving your employees the tools and skills to be financially secure will have long term flow on benefits to your own business.