What is Financial Wellness?
By Joe DeNoyior
One of the greatest shifts happening in the workplace right now is the rise of the next generation of workers. That is paired with the advancing pace of change brought about by technology. This change in the working environment means more employees are expecting their employer to provide additional benefits, insight, and access to information than ever before.
As a result of this change, many are re-examining how they look at their overall benefits strategy, and identifying not only new benefits to include, but also updating the process to help their employees become more engaged in these offerings. This is where financial wellness comes into play.
What is Financial Wellness?
Financial wellness is providing the employee the ability to improve their overall financial literacy or financial know-how in order to provide them more confidence to make financial decisions.
These financial decisions help give them the ability to feel confident with their short-term financial picture while also focusing on some long-term financial goals.
Up until now, financial wellness has been more of a product. A company would buy a thing called a “financial wellness benefit” and hope that employees use it.
In today’s environment financial wellness is evolving from a product into a process. A key component of this process is employee engagement and participation.
How do We Provide Financial Wellness?
The key to this question is, “How do we engage employees in their financial wellness?” It isn’t something you can provide without their participation. And in today’s technology ecosystem we find that the combination of technology and human elements make a huge difference in driving engagement.
The financial wellness process is done in three steps, which repeat cyclically (usually annually) to help educate, inform, and guide employees on a path towards better financial wellness.
- It starts with a financial assessment which provides a snapshot of your employees’ current financial situation and their goals.
- It then provides them information specific to them and their goals that aims to steer them down a path that leads to their financial goals.
- It then provides periodic check-ins that seek to ensure they’re progressing on this path and help overcome unforeseen obstacles that may come up over time.
Why Does Financial Wellness Matter?
Financial stress is a major contributing factor to stress-related illnesses, and employers can help their employees manage this stress by empowering them to better understand, control, and ultimately have confidence in their overall financial picture.
At Washington Financial Group we’ve seen the marked impact that financial wellness has the opportunity to have on employees, including:
- An increase in employee productivity
- An increase in employee workplace satisfaction
- A decrease in employee absences
Many employees expect their employer to help them out with their finances beyond a paycheck and basic health benefits. This includes providing them the opportunity to expand their knowledge and empower them to feel confident in their management of their personal finances.
At WFG we feel that wellness is not only a key part to an overall benefit strategy, it could also be a driver in getting better results for things like your retirement plan, lowering costs of your health insurance, and making yours a better place to work. Let’s chat about how we help our clients foster financial wellness.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Global Retirement Partners, LLC (GRP) a registered investment advisor. GRP, LPL Financial, and Washington Financial Group are separate non-affiliated entities.