Published on: 24 July 2020
Modified on: 10 April 2023
Financial Wellness is an integral part of everyone’s life. Essentially, financial wellness refers to effectively managing one’s economic life. It can include different aspects, such as spending while keeping one’s financial capacity in mind, being prepared for emergencies, having access to and making use of tools and information necessary for making sound financial decisions, and planning for the future. Even though it is an important concept, it is often overlooked and neglected.
In fact, 69% of employees are stressed out about their finances, and up to 72% worry about their finances at work. Thus, the concept of financial wellness has become imperative to both employers and employees.
When we talk about financial wellness, it’s best to not limit ourselves to the present scenario. Financial wellness extends well into the future, as it refers to a person’s overall financial health and the absence of money-related stress.
One of the many concepts on which financial wellness is based upon is adopting healthy financial habits in the long run. Adequate savings and spending habits that employees learn during their professional careers can be carried well into retirement years.
When we talk about retirement plans and saving for retirement, it’s not limited to people who will be retiring in a span of 5-10 years. Retirement plans have to be put into action as soon as one establishes their career, at a young age. A majority of young employees might see that, if they calculate, they are significantly unprepared for retirement, and need to save more. Financial wellness is primarily accumulation driven, which has now become an outdated approach, especially with the advent and rise of technology.
Many current wellness programs, however, are ineffective. This is because they focus primarily on providing information or access to additional content or resources, such as:
The problem arises because these alternatives require significant time and effort. Hence, they are rarely accessed by employees and are rarely paired with concrete, actionable steps for extending financial wellness.
When it comes to planning for one’s retirement, sooner is always better.
Technology plays a crucial role in helping employees plan for financial wellness well into retirement:
It’s imperative to understand that these initiatives are not beneficial only for employees approaching the retirement age. According to a recent study, over 67% of millennials have some sort of retirement savings plan. This hints that the younger generation can benefit immensely from a technology-based financial wellness platform with a human touch.
Financial wellness tools can help provide financial balance and adequate knowledge and guidance to set young employees up for success. It is only normal that currently, we see an increasing number of companies desire highly motivated employees with the greatest productivity, enhancing their benefits experience with these tools.
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Category : Finance
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