Financial Planning
National Financial Planning Month is the perfect time to teach team members about the importance of financial wellness and cover voluntary assistance programs. While many companies provide a general overview of annual retirement savings benefits, some businesses are starting to offer employees more comprehensive resources and educational materials to help meet with today’s fiscal concerns.
According to Debt.com’s financial planning statistics, only 30% of Americans have a long-term financial plan that includes savings and retirement goals.
Poor financial planning over a long period of time can lead to a bad credit rating, higher stress levels and, eventually, extreme debt. In addition, long-term stress can have a tremendous impact on mental health.
Certain employee programs or resources can help businesses prepare team members for major life events or unprecedented emergencies. And with the proper education, employees can learn fiscal responsibility and money management skills that improve financial wellness and stability within your organization. Here, we offer insight into financial wellness as a whole, tips to keep your team members better informed — and resources aimed at making the education process easier.
What is Financial Wellness?
The concept of financial wellness ties into personal stability and security, or whether an individual can reasonably afford current and future financial goals.
In Corporate Wellness Magazine, Gallup leaders define financial wellness as “effectively managing your economic life” through budgeting, planning and utilizing available resources.
Financial wellness is closely linked to mental health because money is one of the main stressors for employees today. Surveys show that more than 60% of employees admit that worrying about money directly impacts their work performance.
Alleviating financial stress through assistance programs and employee benefit offerings can have a positive effect on your team members’ wellbeing and financial literacy. Employee health and wellness are invaluable, but there are a considerable number of reasons why focusing on financial wellness is advantageous to businesses.
Why Should Employers Offer Financial Planning Assistance?
Financial Planning Assistance programs can help companies boost morale, improve productivity and focus, lower employee turnover and contribute to a positive corporate image. Fiscal responsibility is a universal concept that applies to other aspects of work and life, but financial planning can also be an excellent source of motivation.
Creating a retirement plan, learning about benefit incentives and budgeting for major life events can motivate team members by turning the concept of saving for the future into something more tangible. When employees set due dates and establish specific objectives, they begin measuring their return on investment and understanding the value of contributing to their future. A lack of financial wellness can have the opposite effect on a business.
A 2022 PwC survey found that employees with financial stress were at least six times more likely to report struggling with productivity and attendance than those who felt financially stable. They were also twice as likely to search for a new job.
Personal economic troubles often lead to increased anxiety and even sleep deprivation, which can further impact long-term financial situations and lead to poor credit or debt. In such instances, money problems can lead to serious mental (and in extreme cases, physical) health issues where individuals lack basic necessities such as adequate food and shelter. Learning how to budget and save money for emergencies can help prevent a cycle of financial instability from taking over. Download our Coping with Financial Crises sheet for insights to help with financial wellness.
Types of Financial Planning Assistance
There are a number of financial planning assistance benefits that companies can offer employees to help them start money management on a smart foot. Those include:
- Educational resources and programs to help with managing personal finances
- Investment, retirement and emergency planning seminars
- One-on-one counseling
- Programs that cover debt and credit management
- Budgeting templates and calculators
BCH Tip: Download our Financial Planning Assistance sheet for insights into the benefits of money management programs.
Financial Planning and Retirement Savings
Financial planning or financial literacy can help individuals understand how to budget based on their income, expenses and long-term goals. One of the most important long-term goals is planning for retirement.
In 2021, only 42% of Americans reported calculating how much they need to save for retirement and 30% did not elect into their employer’s 401(k) benefits package.
Employees should take advantage of retirement benefits, especially in cases where companies offer employer contributions. For businesses that don’t initiate automatic enrollment, follow-up communications and our Planning for Retirement handout can help get team members on track to retire before it’s too late.
It’s important for employees to be aware of the benefits available to them, but it’s just as crucial that they understand how to access educational resources and plan for the future. For more tips on retirement savings strategies, download our Top 10 Ways to Save for Retirement sheet.
By offering financial assistance programs and educational resources, employers can help alleviate stress and motivate team members to reach for long-term financial goals. Encouraging employees to plan for retirement and take advantage of investment opportunities can also set them up for future success with the company. For businesses interested in improving financial wellness through their employee benefits or voluntary assistance programs, contact a benefits advisor today. BCH is here to help your team stay healthy and focused when it matters.