Financial Wellness Programs for Businesses

If you’re a small business owner, chances are that at least some of your workforce is stressed and distracted by worries about money, making them more frazzled and less productive on the job. Studies show that 73% of Americans say their finances are the number one cause of stress in their life.1 And for those who are employed, nearly half say that personal financial issues create distractions at work.2

These statistics could paint a worrisome picture of the mental health of your employee population. They could also impact your company’s bottom line. Each year, employers lose an average of $1,900 per employee in lost productivity due to financial stress.2 This helps explain why more and more employers are making financial wellness programs available as a workplace benefit.

Financial wellness is mutually beneficial for both employees and employers. Such programs can improve your company’s fiscal health while boosting your employees’ productivity and engagement. Let’s take a closer look at employee financial wellness programs and the benefits they can bring to both employees and employer.

What is an employee financial wellness program?

Employee financial wellness programs are programs that help employees better manage their finances and reduce financial worries. As such, they contribute to a better overall financial wellbeing for employees.

When it comes to employee financial wellness, employers can implement a variety of different programs and offerings. Some focus solely on financial education, while others layer employer matching, financial assistance, and other opportunities into the equation.

Educational-focused programs, for example, may provide employees with financial workshops about homeownership, retirement savings, budgeting, or debt management. Employer matching programs may involve matching a certain percentage of retirement contributions employees make to their 401(k) or to student loans. And other types of financial assistance could include tuition assistance, medical bill negotiation, or financial planning subsidies.

The key to a successful financial wellness program is first determining the specific needs of your employees so that you can more accurately meet those needs. Different workforces will have different financial situations and necessitate different programs.

Why is it important for employers?

In a recent survey, nearly 70 percent of employers say they recognize the value in offering financial wellness programs to make them more competitive in hiring and retaining employees.3 If you haven’t explored a financial wellness program for your employees, you may want to consider how adding one could benefit your organization. Doing so may provide:

The potential to enhance workplace satisfaction as your employees gain greater confidence about their financial direction in life.
Improved productivity among employees who are no longer overwhelmed with concerns about their financial situation
Better retention of employees, who find enhanced gratification from work that they are confident is fulfilling their financial needs
The potential that employees who carry less stress about their financial well-being will enjoy greater health, resulting in fewer medical issues and reduced health care costs.

Financial wellness programs should be looked at as an attractive add-on to your company’s total compensation plan.

Plans can be structured to suit the needs of your business. Reach out to your financial advisor. Ameriprise Financial and other firms have programs that can be designed to benefit your employees.

1 2021 CreditWise National Get Smart About Credit survey.

2 2020 PWC Employee Financial Wellness survey.

3 MassMutual Financial Wellness Trend Study, Feb. 2020.

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Michael D. Lanuto, CRPC®, AWMA® is a Financial Advisor with S.M. Miller & Associates, a private wealth advisory practice of Ameriprise Financial Services, LLC. in Albany, NY. He specializes in fee-based financial planning and asset management strategies and has been in practice for 7 years. To contact him: 518-949-2039; 4 Atrium Drive, Ste 200, Albany, NY, 12205; Michael.Lanuto@ampf.com; https://www.ameripriseadvisors.com/michael.lanuto/lp/request-contact/3/.