Why Employers Should Improve Employee Financial Education
Workplace productivity is a top concern for employers across all industries. It’s a constant challenge to find new ways to improve monthly or quarterly goals and equally upsetting when managers notice a downtick in motivation and commitment. One serious factor contributing to office distraction is financial stress. According to a report by Personal Finance Employee Education Foundation, nearly 1 in 4 employees are suffering from persistent financial woes. These millions of stressed individuals find it difficult to leave their problems at the door as it’s estimated that 30 to 80 percent of employees with serious financial problems focus on their personal situation rather than workplace objectives.
How financial stress impacts employees
Whether it’s millennials strapped with enormous student loan debt, Gen X’ers caring for their parents, woes about adequate retirement savings, or ever-evolving home maintenance costs, there are a number of stressful financial situations likely impacting a number of your employees. All of which contribute to lost productivity and lower engagement regardless of the employee’s position or responsibility. Without a process in place to properly showcase the full extent of your company benefits or a commitment to financial education, employees may start to harbor resentment and look for other opportunities.
How financial stress impacts employers
On top of being a major distraction at work, personal financial stress contributes to employee turnover, health claims, and absenteeism. Considering these negative impacts, many employers are incorporating financial education into their onboarding and employee training programs in addition to personalizing health care plans and explaining 401(k) opportunities. Choosing to pay for a knowledgeable financial speaker is considerably cheaper than suffering the loss of a qualified employee.
How to improve financial education
Improving employee financial education is a great way to decrease lost productivity and contribute to a thriving company culture. Financial education can be as basic as clearly outlining health benefits and retirement plans to ensure employees know how to utilize them to their full potential. Increasing financial education opportunities and outlining the full extent of existing company benefits helps renew a sense of workplace commitment among employees.
While some individuals don’t feel comfortable talking about personal finance or think financial decisions should solely be discussed among family members, it’s easy and beneficial for employers to host a trained financial consultant to speak knowledgeably about these topics, even if it’s just an annual event. To further increase participation and maximize an event’s usefulness, consider letting employees bring their spouses. It may make more sense to host the event after work hours or during a family-friendly company event under these conditions.
Providing financial literacy education opportunities not only demonstrates you care about your employees but also expresses a general concern for their family’s well-being. By providing employees valuable insight into responsible financial practices, as well as your company’s opportunities available to them, you’ll be favorably improving your bottom line as well as inspiring confidence company-wide.
