Monetary Wellness Is Now a Requirement, Not a Perk

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Financial Wellness Is Now a Requirement, Not a Perk

November
27, 2020

5 min read

The opinions expressed by the entrepreneur's contributors are their own.

One of the most stressful aspects of being a business owner is knowing exactly what to do but not having the time and money to do it when it is needed. And unfortunately, it doesn't get better as your business grows. You will always face difficult choices. The only difference is that as your decisions grow, your choices will affect hundreds of people, not just you and your family.

Here is an example dear to my heart as a CPA and financial advisor: Almost all employers know that their employees are struggling with personal debt, and if they could fix it, productivity would skyrocket. However, they do nothing, although there are inexpensive and even free programs that can help.

Related Topics: Does Your Business Include These Employee Wellbeing Trends?

What is Financial Wellbeing?

Financial wellbeing is an acronym for employers who offer financial literacy to their employees. If you are an employer who does not offer a financial wellness program, you are now in the minority.

That's not my opinion either. It's a fascinating fact that I gleaned from Bank of America's 2020 Workplace Benefits Report. Almost 1,000 employees and more than 800 employers provided detailed answers to a range of financial questions. A great contradiction was noticed. While more than 80% of employers “believe that financial wellness tools lead to higher productivity”, only about half actually offer these tools.

The pandemic isn't one of the reasons for this loophole, as Bank of America conducted the survey in February and March. Before Covid, the researchers came to the conclusion that the offer of intellectual and financial education could pay off many times over. From the report:

The additional burdens associated with the coronavirus have increased the issue of wellbeing in many ways. Employees are likely to experience increased levels of stress, demands on their time, and possibly the added complexity of both working from home and full-time caregivers at the same time. While the impact of these unprecedented times has not been fully understood, employees have already noted an increased burden on their physical and mental health, a greater impact on the interactions between all aspects of their wellbeing, and a greater impact on overall wellbeing on productivity. These trends are likely to continue until things return to normal.

I'll go a step further and say these trends will continue to grow even after the pandemic ends. The economic impact of Covid has given Americans who were once resentful of personal debt a strong sense of urgency. Like the Great Depression in its generation, it is very likely that Covid will make permanent changes in this generation.

Related: 4 Ways To Protect Your Mental Health During Covid Second Wave

One of these could be the expectation that the workplace will help its employees more than it does now. In the case of financial well-being, this is what is known as a win-win situation. Let's count the ways …

productivity

Previous studies from John Hancock to Boston College have definitely shown that financial stress leads to more absenteeism among employees. Even when they are at work, financial stress in their personal life distracts them from their duties.

Other studies have shown financially stressed employees lose three hours of money problems every week – a 7.5% drop in productivity per employee. This leads to project delays, poor customer experiences and, of course, lost sales.

diversity

This Bank of America study makes an interesting point. “Unfortunately, women continue to lag behind when it comes to financial wellbeing. Women are less likely to say that they are feeling good financially. “In the study, 65% of men said they had their personal finances under control, compared with only 43% of women.

When you offer your employees a financial wellness program, you are helping everyone – especially your female employees.

recruitment

Good performance recruits the best talent for your company – and performance means more than health insurance. Believe it or not, a robust and proven financial wellness program can appeal to applicants. Why? Precisely because it is new and novel, it stands out from the usual discussions about dentistry and eyesight.

The costs

Employees have provided Bank of America with the following:

  • Advice from a professional such as a financial advisor, planner, or accountant
  • Online financial instruments or calculators
  • Develop financial skills and good financial habits

Related Topics: The Criticality of Ensuring Employees' Financial Wellbeing Beyond Salary

Many companies that specialize in financial wellbeing charge thousands of dollars, but for that money you can offer your employers access to certified credit counselors. But if you just dip your toes into financial wellbeing, or run a small but growing business and have to reinvest every dollar in your business, you can get something for nothing. Many companies that help Americans get out of debt through credit counseling, education, and other programs have packaged their services into modules that are tailored to employers addressing the above concerns.

The pandemic only adds to the urgency that existed before. You know this will work. Smart entrepreneurs don't wait and don't have to spend a penny when they know what success looks like. You deserve it, and so do your employees.