More and more attention and money is being focused on financial education and literacy at work under the rubric of financial wellness but is it effective and how do we measure it just as companies are looking at the ROI on health wellness programs? According the Matt Iverson, CEO of RetireMap, academic research shows that open ended financial education and literacy programs have a 0.1% effect on behavior. So is there a solution?
No doubt that financial stress can effect employee productivity even more than work and health stress which is why more employers are looking at incorporating financial wellness into their health wellness programs. But just providing general education with a coach and specific goals will likely have little to no impact according to Iverson.
Instead, he recommends a three-part program which might be the Ideal Financial Wellness program which includes:
- Specific Goals
Like a personal trainer, an advisor can help people take action if they make a commitment that has a specific time horizon which Iverson recommends to be two to four months.
When people have personal goals that they choose, not those assigned to them, they are more likely to complete them.
People can be intimidated by the financial issues they face which usually leads to no action. A coach can provide confidence with each step that can lead to positive outcomes.
There’s a lot of attention and money being spent on robo advisors and financial wellness for good reason – there’s a problem and many times technology can help. But, according to Iverson, combining an advisor enabled by technology to design, implement and track customized financial wellness programs can lead to real change not the 0.1% impact that general, open-ended financial education and literacy programs have today.
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