We get it – conversations about employee finances can be uncomfortable. However, as the employer, you are likely the primary source of income for your employees. Plus, it's likely that you are already having conversations with them about their funds in some form, whether that be about compensation, pay advances, or bonuses.

Financial stress is one of the leading causes of stress among employees, so if they’re worried about their finances, they’re probably not performing as well at work. As a result, HR professionals need to make it a priority to care about their employees’ financial well-being if they want to keep employees engaged, productive, and happy, both inside and outside of work.

Key reasons why HR managers should prioritize employee financial wellbeing

1. Increased employee engagement – Employees who feel secure about their financial future are more likely to remain engaged and productive at work.
2. Reduced stress – Money stress can affect employees ability to focus, leading to decreased productivity and morale.
3. Improved retention – Employees who feel financially secure are more likely to stay with their employer long-term. This can help reduce turnover costs, as finding and onboarding new employees is expensive.
4. Cost savings – When employees are financially secure, they are less likely to need to access costly, high-interest solutions like payday loans. This can help employers save money in the long-run.
5. Happiness and loyalty – Employees who are financially secure are happier and more loyal to their employer. This can lead to improved employee morale, engagement, and productivity.

Tips for how HR managers can support employee financial wellness

There are several steps that HR managers can take to ensure their employees’ financial wellbeing, from offering flexible spending accounts and employee assistance programs to providing financial literacy classes or workshops and preventing any form of financial discrimination. With the right resources, guidance, and support, HR managers can create an environment where their employees thrive financially. Taking these preventive measures can help protect employees’ financial future and improve overall employee performance, morale, and retention. Here are some tips:

1. Offer flexible spending accounts, such as health savings accounts or dependent care spending accounts.
2. Create an employee assistance program that provides free financial counseling, budgeting tips, and access to financial workshops.
3. Provide access to different retirement savings options and educate employees on the importance of saving for retirement.
4. Offer financial literacy classes or workshops to help employees better understand credit, debt, and taxes.
5. Review employees’ benefits package to ensure it includes financial protection benefits such as life insurance, disability insurance, and emergency savings.
6. Encourage team members to set financial goals, track their progress, and celebrate their successes.
7. Create a company policy that prevents any form of discrimination based on an employee’s financial situation.
8. Leverage financial tools and technology to help with all of the items listed above.

HR professionals play an important role in supporting employees’ financial wellbeing. Taking the time to provide the support and resources needed to ensure financial security can help create a more engaged and productive workforce. Learn how here.

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