Why employee financial education is good for your business
Workplace productivity is a top concern for employers across all industries. It’s a constant challenge to find new ways to improve monthly or quarterly goals, especially when managers notice a downtick in motivation and commitment. In this blog we'll focus on the advantages of employee financial education and how it can have a positive effect on your employees.
WHAT IS FINANCIAL EDUCATION FOR EMPLOYEES?
Financial education can be as basic as clearly outlining health benefits and retirement plans to ensure employees know how to utilize them to their full potential. Increasing employee financial education opportunities and outlining the full extent of existing company benefits helps renew a sense of workplace commitment among employees.
While some individuals don’t feel comfortable talking about personal finance or think financial decisions should solely be discussed among family members, it’s easy and beneficial for employers to host a trained financial consultant to speak knowledgeably about these topics, even if it’s just an annual event. To increase participation and maximize an event’s usefulness, consider letting employees bring their spouses. It may make sense to host the event after work hours or during a family-friendly company event under these conditions.
WHY IS EMPLOYEE FINANCIAL EDUCATION IMPORTANT?
One serious factor contributing to office distraction is financial stress. According to a report by the Personal Finance Employee Education Foundation, nearly 1 in 4 employees are suffering from persistent financial woes. These millions of stressed individuals find it difficult to leave their problems at the door as it’s estimated that 30 to 80 percent of employees with serious financial problems focus on their personal situation rather than meeting their workplace objectives.
Providing employee financial education not only demonstrates you care about your employees but also expresses a general concern for their family’s well-being.
COMMON FINANCIAL CHALLENGES FACED BY EMPLOYEES
Whether it’s Millennials strapped with enormous student loan debt, Gen X’ers caring for their parents, worries about adequate retirement savings, or ever-increasing home maintenance costs, several stressful financial situations can impact your employees. All of which contribute to lost productivity and lower engagement regardless of the employee’s position or responsibility. Without a process to properly showcase the full extent of your company benefits or a commitment to financial education, employees may start to harbor resentment and look for other opportunities.
HOW EMPLOYEE FINANCIAL STRESS AFFECTS YOUR EMPLOYEES
On top of being a distraction at work, personal financial stress contributes to employee turnover, health claims, and absenteeism. A major side effect of financial stress on mental health is problems with sleep. Long-term sleeplessness affects mood, concentration, and appetite and can cause anxiety and depression. It’s important that employers know how to look out for these red flags and make themselves available and approachable to any employees who might be struggling.
Considering these negative impacts, many employers are incorporating employee financial education into their onboarding and employee training programs in addition to personalizing health care plans and explaining 401(k) (a tax-efficient retirement option provided by employers) opportunities. Paying for a knowledgeable financial speaker is considerably cheaper than suffering the loss of a qualified employee.
THE BENEFITS OF EMPLOYEE FINANCIAL EDUCATION
Improving employee financial education is a great way to decrease lost productivity and contribute to a thriving company culture. By providing employees with valuable insight into responsible financial practices, as well as your company’s opportunities available to them, you’ll be favorably improving your bottom line and inspiring confidence company-wide. Employees are more likely to stay at an organization that looks after them and is willing to help them through difficult times.
NEXT STEPS
Employee financial education is important to any business and so is saving time on your payroll processing! Please reach out to our stellar payroll team to see how we can help.
