15 November 2022
Employees increasingly want more than simply a job. They are looking for employment that provides more than just paid time off and health insurance. They desire tax incentives, a retirement plan, debt relief, and assistance with personal financial planning. Employees appreciate their employers for offering fair financial wellness services, which are difficult to find elsewhere.
Financial wellness refers to an individual’s total financial health and is one aspect that contributes to employee well-being. Many companies have shifted their attention to employee financial wellness initiatives to add value to their pay packages. Financial wellness programs assist employees in reducing money-related stress and gaining better control over their finances.
Many problems awaited employees in 2020, including financial hardship, lower labor productivity, and increasing financial strain owing to the pandemic.
According to a The7thFold’s study:
Employees with low incomes could not afford the consequences of the pandemic, but those with higher incomes also fared poorly. Employees with yearly salaries of INR 21-30 lakhs p.a. reported the highest risk of stress and the worst levels of mental health. And an employee cannot expect much from an employer under financial difficulty; of course, this will reflect in their performance.
On the other hand, if employees have fewer financial concerns and distractions, their productivity will increase. A financial wellness program can assist employees in achieving financial balance and control now and in the future. Improving employees’ financial well-being can lead to happier employees, lower absenteeism, lower turnover rates, more employee satisfaction, and better corporate performance.
To be effective, financial wellness programs must do more than give information. They must also result in employees making proper choices that contribute to financial success. Here’s data from another survey on employee priorities when they were asked if companies should have a role in encouraging employees to:
This demonstrates how critical it is to create a financial wellness program. The following are some of the steps that companies can take to ensure the advancement of their employees:
According to a survey conducted by The7thFold, employees who received an increment and bonus were much happier than those who did not. Employees feel valued and appreciated because their employer cares enough to create possibilities to enhance their financial wellness. According to a recent MetLife research on employee benefits trends, two out of every three employees are more worried than they were before the COVID-19 pandemic.
Stressors such as credit card debt, school loans, and retirement planning generate mental stress. According to studies, employees who know how to spend their money well are less worried than those who do not. Offering some assistance on employees’ debt payments might potentially make a significant impact on their overall financial well-being for companies with the resources.
A program like this can also help employees establish better saving habits and deal with unforeseen financial difficulties. Employers must give better tools and resources to educate employees about an emergency fund and encourage them to establish one.
Because the workforce is changing faster than ever, businesses must examine the implications of employee financial wellness initiatives on the health and engagement of their employees. Employers must first identify and understand these at-risk categories to assist their workers. Following that, a well-planned financial wellness program that can do wonders for an organisation and its workers should be launched.