Financial Wellness Programs Impact Physical Health
Financial wellness programs have become a popular employee benefit. One of the reasons financial wellness programs have become so popular is due to how it impacts an employee’s physical and mental health. Employees who have access to financial wellness programs and health and wellness benefits tend to be healthier than those who don’t, according to a recent Prudential study cited in BenefitsPro. These employees “are more productive, less susceptible to illness, less burdened by stress and better able to tackle new challenges/opportunities.”
According to Integrity Data, over fifty percent of employers offer some sort of financial wellness program, and both employers and employees report a higher level of satisfaction with their benefit plans when a financial wellness program is offered. It turns out, offering financial wellness programs, along with health and wellness benefits, may help employees to be healthier overall.
The presence of a financial wellness program in the workplace seems to not only to improve employees’ health but also appears to reduce employees’ stress levels. Workers who participate in a financial wellness program are more likely to report themselves as physically healthy, with 45% of users doing so versus 42% of those who don’t participate in financial wellness programs. In addition, 26% of financial wellness program users are likely to report lower levels of stress than non-users (22%).
While prior research seems to have indicated that wellness programs may not have had the universally positive effect that early proponents had hoped, the Prudential Wellness Programs Census report seems to indicate that things are changing. Per the report: “The interplay between physical and financial health suggests that employers who don’t offer financial wellness programs may want to reconsider. Researchers have found that even small changes in socioeconomic position can impact health risk, with incremental increases in income associated with improved health.”
Employers should give serious attention to analyzing financial wellness programs. Nearly a third of employees report being distracted by their finances at work. Offering financial wellness programs in the workplace could multiply the seemingly positive effects discovered in the Prudential study.
The Prudential report indicates that employers are doing better with health and wellness benefits than they are on financial wellness programs. When employers do offer a health and wellness program, they generally offer employees incentives for participating. The same doesn’t hold true for financial wellness programs. Moreover, employees have difficulty equating the reward of putting themselves on a firmer financial footing with participating in a financial wellness program. The connection simply isn’t as clear or easy to understand. Plus, the employee has to do the work to reap the rewards of a financial wellness program rather than simply receiving a participation award as they do for enrolling a health and wellness program.
According to the Prudential study, employees would like employers to provide one or more of the following benefits, though some are not currently widely available in financial wellness programs:
- Identity theft protection
- After-tax emergency savings accounts
- Financial coaching services
- Financial education classes
- Online financial management tools
- Digital financial advice and planning
- Accrued wage advances
- Low-interest loans
- Debt consolidation/payment programs
Of course, simply offering a financial wellness program does not automatically mean that employees will achieve their financial goals successfully. There needs to be some modicum of accountability built into the financial wellness program, or else participants are less likely to reach their goals. Periodic check-ins with a financial advisor, or with peers, can be tremendously helpful in moving the needle for employees who participate in financial wellness programs. Gamification — where the process of achieving the goal requires the employee to compete against peers or against themselves — can also induce employees to make the most of financial wellness programs.
If an employer- organization currently doesn’t offer a financial wellness program, or if that benefit could stand to be a bit more robust, consider implementing a financial wellness program or talking to your current retirement plan advisor, or a Certified 401k Professional about making positive changes. Doing so could improve your employees’ financial well-being and their overall health as well.