Financial Wellness Benefits: Your Company’s Top HR Priority for 2021

August 19th, 2021

Nearly three-quarters of employees admit: the biggest workplace distraction is worrying about personal finances. 

It’s a trend that chips away at employee well-being and your bottom line. Employees spend work hours on hold with debtors. They toil over how they’ll pay an upcoming credit card or medical bill. They feel powerless. Money is a persistent worry grating their focus and happiness.

One study found that U.S. businesses lose $500 billion per year simply due to employees distracted by financial stressors. Researchers at Harvard found that presenteeism—showing up at work but feeling distracted by personal problems—hinders productivity more than not showing up at all

Savvy employers aren’t sitting on the sidelines. They’re stepping up to help reduce money-related stress with new financial wellness programs

What is financial wellness? 

Financial wellness seeks to empower one’s relationship with money. It’s not a constant state of anxiety fretting over how much money is in the bank or how you’ll pay your bills. Instead of drowning in financial stress, it’s a freeing feeling of financial security. 

Employers that offer a strong portfolio of financial wellness benefits enjoy a boost to nearly every bottom-line metric: 

When businesses help employees flourish financially, everyone wins. 

What’s included in a powerhouse financial wellness package?  

How do you offer a winning financial wellness package? By actively helping employees take full control of their financial future. Top financial wellness packages include educational tools, flexible pay structures, and top-tier benefits typically reserved for those in more comfortable financial situations. 

On-demand pay

In many industries, weekly or bi-weekly pay periods are the standard. But for workers experiencing financial hardship, the wait can be punishing. To cover weekly expenses, they turn to high-fee payday loans or incur hefty overdraft fees. 

Companies like Clair are now providing financial tools that give workers access to their wages as soon as they clock out. This on-demand pay access gives workers the ability to advance wages for daily expenses such as gas, emergency medical bills, or monthly rent without settling for high interest rates or overdraft fees. The funds workers withdraw are then deducted from their next scheduled paycheck. 

On-demand pay frees hourly employees from the yoke of pay structures more suitable for salaried staff. Instead of living paycheck to paycheck, workers can take control of their finances and gain peace of mind with immediate pay. 

Student loan repayment assistance

Student loan debt tops the charts as the most crushing financial worry. It’s not only a drain on personal finances, but it postpones exciting life decisions for many workers like getting married, owning a home, or having children. While some dismiss student loan debt as a problem for younger generations to contend with, it negatively impacts workers of all ages

Many businesses are rushing to the rescue. Student loan repayment assistance is a new edition to the modern financial wellness portfolio. Employers can match monthly payments up to a certain amount. They can also contribute to an employee’s retirement fund while they work to pay off their student debt. 

Financial education tools

Many businesses are emerging as stewards of financial empowerment. They’re offering fresh tools that help employees learn how to save, invest, and pay down debt. Top employers are offering programs that help their teams: 

  • Track and monitor spending behaviors

  • Learn how to budget

  • Put aside funds each month for a savings account

  • Open low-fee digital bank accounts

It’s more than distributing a folder full of paperwork at an annual all-hands meeting. Companies are sweetening the pot with add-ons like monthly workshops and one-on-one coaching sessions with financial advisors. 

Investment training

Three out of four millennials don’t partake in the stock market. Why? Over half believe they can’t afford to. Many are under the impression that these lucrative opportunities are reserved only for the wealthy. 

To put a stop to this false belief, businesses are opening new doors to financial freedom for non-investors. By providing investment tips, tricks, and coaches, employees can learn the small steps they can take to start investing in their future.

Credit score building

Many hourly employees make up the United States’ growing “credit invisible” population. This group of one in five Americans has never established a credit profile. This makes it challenging to get car loans, mortgages, and apartment approvals. By helping employees build their credit scores, businesses now offer perks that financially turbulent employees can’t get from traditional banks. 

Financial wellness packages not only empower your employees, they power the future of your company as well. By offering financial tools that combat their most pressing concerns, you create a welcoming environment anyone would love to work in. 

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About the Author

Nico Simko

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