What makes financial wellness crucial in the workplace?

The concept of employee wellness has evolved far beyond the traditional focus on physical and mental health. While maintaining a healthy body and mind remains paramount, there is a growing recognition that true wellness encompasses a broader spectrum of factors, including financial well-being. 

As individuals spend a significant portion of their lives in the workplace, only a few employers are acknowledging the importance of addressing financial health as a vital component of overall wellness initiatives. Employee wellness programs have long been a staple in many organisations, offering benefits such as gym memberships, mental health resources, and healthy eating options. 

While these initiatives undoubtedly contribute to the well-being of employees, they often overlook a critical aspect of wellness: financial stability. Research has consistently shown that financial stress can have a profound impact on an individual's physical and mental health, productivity, and overall job satisfaction. 

Therefore, addressing financial wellness is not just a matter of altruism but also a strategic imperative for employers seeking to foster a healthy, engaged, and productive workforce, stressed Dana Rogers, VP of people & great work of O.C. Tanner, during an exclusive interview with People Matters. 

Excerpts from the interview:

How do you define financial wellness, and what are the key components of financial wellness programs?

Financial wellness is the ability of a person to create and maintain a financially secure present and future. Someone with positive financial wellness understands the fundamentals of personal finance like budgeting, saving and investing, which allows them to make more advantageous financial choices and have better money management strategies. Shockingly, only about half (57%) of Americans are financially literate, putting those who are not at a severe disadvantage. 

Financial wellness programs can look different, but they often include an educational aspect. Addressing the low number of financially literate Americans is key, and a great place for employers to start. They can also include retirement planning resources, financial advisor support and budgeting tools. At O.C. Tanner, we use “SmartDollar,” an application that grants employees access to one-on-one coaching, educational content and more. 

How important do you consider employee happiness and fulfilment in achieving organisational success and why?

Employee fulfilment, both inside and outside of work, is foundational to organisational success. Employees who feel fulfilled are 90% more likely to stay for another year at their organisations, while conversely, those who feel unfulfilled are 340% more likely to leave the organisation in one year or less. Employee loyalty is an incredibly valuable asset to an organisation’s bottom line, as they are more likely to promote their company externally, leading to new talent or client relationships. Additionally, high turnover rates are costly to an organisation, so having a fulfilled, happy workforce plays into retention strategies.

How do financial wellness benefits contribute to shaping organisational culture and values? Have you observed any trends or patterns in how financial wellness benefits are perceived by employees? 

Finances are top of mind among employees due to rising inflation rates and cost of living, and finances remain the number one stressor among Americans. Seventy-five per cent of employees believe financial wellness is an important part of a compensation plan, yet only 28% of employers offer some sort of financial wellness benefit. 

There’s a clear demand from employees, so it’s time that employers bridge the gap. Providing benefits that address current societal issues like financial wellness resources shows employees that their organisations are constantly finding ways to support them, inside and outside of work. This helps build a positive culture and trust, which improves retention rates and helps attract top talent.

In your view, what impact do financial wellness benefits have on employee productivity and performance?

The purpose of a benefits package is to provide resources for employees outside of work that help people thrive in their roles. There are a few factors that directly contribute to employee engagement and fulfillment, one of them being well-being. When organisations allow employees the flexibility to find balance in their lives and care about them as a whole person versus just their efficiency input, they create a sense of inclusion and belonging among employees. 

Financial wellness provides security and supports employees and their families in big life moments – such as buying a home or saving for retirement. Supporting employees through practical benefits like financial wellness programs helps remove some of the financial stress, allowing employees to show up to work without feeling anxious or stressed out, which positively impacts performance. 

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What challenges or barriers do organisations face when implementing financial wellness programs?  How can organisations leverage financial wellness benefits to enhance employee well-being and competitive positioning in the market?

Financial wellness programs are a newer benefit offering, so once implemented, many employees may not be aware of the service or how to make use of it. In this instance, organisations must set up proper training sessions with employees to walk through what is available to them and share the benefits of engaging with financial wellness programs. HR teams and leaders should also continuously remind employees of the benefit offerings and communicate it during the onboarding process to alert new employees of what benefits they can start utilising. 

Offering financial wellness programs makes an organisation very competitive in the labor market. Employees are increasingly looking at the holistic offer package, and when companies have unique benefit offerings like financial wellness, they get a leg up on competitors that may not offer the same. Beyond the advantages these programs present in attracting top talent, they also foster a positive work culture that decreases attrition rate and creates a fulfilling employee experience.