More than 40 percent of Americans admit that financial stress makes it difficult for them to concentrate at work, leading to long-term impacts on productivity, revenue, and employee churn. In fact, research by John Hancock Retirement found the loss of productivity combined with absenteeism from financial stress costs employers more than an estimated $1,900 per year, per employee, and total an estimated annual loss of $1 million for mid-sized employers and $19 million for large employers.
It’s also important to note that the recent COVID-19 pandemic has had a serious impact on American’s financial stress levels. Surveys show that 62% of workers feel financially stressed, an increase of 23% since the pandemic began.
However, there is a silver lining to this doom and gloom, and it comes in the form of providing an opportunity for businesses to stand out to future employees. With 60% of workers stating that a financial wellness program increases their loyalty to an employer and 80-90% reporting that they would want a financial wellness benefit, your organization should be seriously considering offering employees some form of financial wellness program.
Continue reading to learn five ways a financial wellness program will directly relate to and improve your employees’ performance and productivity.
1. Increased productivity
It should come as no surprise that people with financial stress bring it to work. Research shows that nearly six in ten workers say they worry about their finances during work hours, while a whopping 43% spend time on their finances at some point during work. And if you needed further proof that your employees would benefit from a financial wellness program, close to half of those who worry about their finances during work say their productivity would increase if they didn’t spend their time worrying about personal finances.
By looking at how you, as an employer, can equip your workers with additional financial wellness and resources to help them with their financial planning will directly end up benefiting not only their financial success but yours by virtue of their work performance.
2. Decreased stress levels
A lack of financial planning can often lead to an unhealthy amount of stress on your employees. And while reasons for financial stress are unique to each person, it often comes down to a lack of sufficient planning and money management. Enter the financial plan.
Providing some type of financial wellness program (perhaps in the form of a financial plan) is one of the most certain ways to alleviate and reduce your employees’ financial stress. In fact, seven in ten workers feel as though employer-provided financial wellness programs have an impact on reducing their financial stress.
Through additional surveys, Savology was able to determine that 83% of households with a financial plan feel better, and less stressed, about their finances after just one year.
When employees learn how to plan their financial future properly, they better understand how to protect their income, grow their savings, decrease their spending, and much more. Overall, you’ll have a much happier staff when your employees feel like they have a good handle on their finances.
3. Higher loyalty
Offering your staff financial wellness programs isn’t only beneficial to your employees—your business will reap the benefits as well—one of those being employee retention.
Retention of a positive and motivated employee is crucial for your organization’s success. High employee turnover can increase your business expenses and negatively impact the organization’s overall morale.
Building loyalty isn’t always the easiest to achieve. Ultimately it comes down to providing the right resources, tools, and benefits for your employees—one of those being to offer a financial wellness program. 59% of workers say that financial wellness benefits improve loyalty and the likelihood that they’d recommend their employer. Seems like a no-brainer to us.
4. Improved focus
Did you know that the average 9-5 employee loses 2.1 hours a day to distractions and interruptions? That adds up to over a full day of work every week. Perhaps even worse, employees who do most of their work on computers (raise your hand if you’ve been working from home since March 2019) are distracted every 10.5 minutes.
These distractions can come in a variety of different forms. As an employer, it’s important that you’re doing everything you can to minimize the amount of (negative) distractions in the workplace. This could include offering your staff various initiatives, incentives, and benefits to ensure their work performance remains unimpacted.
Personal finances are a common distraction for employees, both at work and in their personal lives. Offering a financial wellness benefit to your staff reduces their financial stress while increasing their financial literacy and stability.
5. Stronger mental (and physical) health
As the saying goes, health is wealth. This certainly also rings true for your employees and your company’s balance sheet. In other words, your employees’ health is your company’s wealth.
However, in the past year, the COVID-19 pandemic has seriously challenged many American’s mental health, while increasing their concern for their current financial situation. In fact, having financial difficulties is top of mind for 64% of individuals.
All this worry isn’t healthy. Financial stress can be incredibly draining on one’s mind and can lead to serious effects on an employee’s physical health. Dealing with increased anxiety, exhaustion, and heightened emotion can often lead to a loss of sleep, appetite, and considerably less energy. All of which significantly impact your employee’s work and personal life.
Now more than ever, it’s important that as an employer, you make an active effort to support your staff’s mental and physical well-being. By doing so, you’ll likely see an improvement in both the workplace’s performance and productivity.
How you can help your employees
Remember that your employees are your company’s largest asset. By investing in them, you’re also investing in the success of the business.
As an employer, you must provide your staff with additional resources and tools outside of a standard benefits package. This can directly show your employees that the business cares about and understands their needs. It also enforces the premise that their success outside of the workplace is important and matters to the organization.
Savology is helping employers provide their employees with effective financial wellness benefits that make a difference. Through our personalized financial planning, tools, and education, you can be confident that you’re making a difference in your employees’ lives, and not just checking a box. Learn how you can reduce employee stress, increase productivity, and help your employees reach their goals today.