Winning Bet: Double Down on the Benefits of Financial Wellness Programs

Date posted: August 1, 2016

financial wellness

By Joe DeSilva

If you’re a small business leader, you’re likely juggling multiple demands – from customer service and hiring, to payroll, capital improvements and more – to keep your company running smoothly. As a result, an employee financial wellness program may be low on your list of priorities. But don’t overlook the long-term benefits this type of program can offer to your business and your employees.

Financial worries can preoccupy even the most committed employees, many of whom may not have recovered from the last recession and might live paycheck to paycheck. This stress can take a toll on employee morale and productivity and even affect people’s health. Consequently, employers may also realize the negative impact of employees’ financial problems if workers are too distracted to perform their jobs well or if the stress drives workers to seek more medical attention, which can lead to increased healthcare costs.

An employee financial wellness program can help alleviate these issues, but many small businesses may not know where to start. Taking a systematic approach to financial wellness can help small business leaders evaluate the types of programs available and the specific needs of employees, and then determine the best way to integrate a program into existing benefit offerings.

Bringing Financial Wellness to the Forefront

Only one in five employers currently offer financial wellness programs to their employees, according to a new research study commissioned by ADP. The low adoption rate may be due to a lack of awareness about these programs; however, the survey found that employers generally support many aspects of financial wellness programs. 92 percent said they are interested in providing employees with basic information about retirement planning, while 84 percent said the same about retirement income planning.

Interestingly, only 12 percent of employers cited cost as the reason they don’t offer financial wellness programs. It could be because these programs can be cost-effective over the long run – some studies suggest that wellness programs may have a return of $1.50 for every dollar spent.[1]

If you’re interested in offering a financial wellness program to your employees, the good news is that you don’t have to start from scratch. There are many resources you can leverage to develop a program that fits the needs of your employees.

Financial advisors and financial planners provide many similar services to their individual clients and can help small businesses design a workplace program. In fact, 58 percent of employers surveyed said financial advisors are their most effective resource for learning about or implementing a financial wellness program. These advisors can help you set up a program and manage it over the long term. Many will provide advice with no initial fee and charge later for additional services; others may charge a flat fee or bill hourly. Financial advisors also can guide you on the best topics to cover in a financial wellness program, such as debt management, budgeting and retirement planning based on the individual needs of employees.

If you don’t already work with a financial advisor, your health benefits broker or consultant may be another helpful resource.

Meeting Employees Where They Are

Like you, your employees may be stretched for time.  So for a financial wellness program to be most effective, it must be delivered through relevant channels and formats. A personalized approach that allows employees to meet with experts face-to-face works well in most cases:

  • 73 percent of employers that currently offer a financial wellness program said they provide seminars or live events
  • 69 percent provide access to one-on-one financial coaching sessions
  • 64 percent offer on-site workshops

Other communications channels can be effective as well – 60 percent of employers sponsoring a financial wellness program offer phone support, and 58 percent provide webinars. Though trendy, mobile apps and games are seen as less effective than other higher-touch methods.

Taking it Step by Step

If it sounds daunting to implement an employee financial wellness program all at once, the good news is that you can roll it out gradually. Start initiating the program with new employees as part of their onboarding process and then expand it to all employees. You also can integrate the program with other employee wellness programs to build upon the structure – and success – of these existing programs.

If you’re struggling with the types of content to offer, an employee survey can help you tailor a financial wellness program to the topics that are most relevant to your employees. Younger employees may benefit from sessions on financial-planning basics, for example, while employees nearing retirement age may appreciate guidance on how to set and maintain a budget after they’ve stopped working.

By generating employee buy-in from the start, small business leaders can create a financial wellness program that will help alleviate employees’ financial stress, boost productivity and lead to better business outcomes.

The views expressed herein are those of the author, are intended for general information only and are not intended to provide investment, financial, tax or legal advice or a recommendation for any particular situation or plan.  ADP, LLC and its affiliates (ADP) do not endorse or recommend specific investment companies or products, financial advisors or service providers; engage or compensate any financial advisors to provide advice to plans or participants; offer financial, investment, tax or legal advice or management services; or serve in a fiduciary capacity with respect to retirement plans.  Nothing herein is intended to be, nor should be construed as, advice or a recommendation for a particular situation or plan.  Please consult with your own advisors for such advice.

Joe DeSilva is a senior vice president and general manager for ADP Retirement Services.

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