Jobs often come with more than a paycheck. Workers may be given health benefits, a retirement plan, flexible spending accounts, tuition reimbursement, supplemental insurance options and more.
“This is where the biggest financial decisions are being made — at work,” says Bobbi Rebell, a certified financial planner and owner of Financial Wellness Strategies, which assists companies with financial wellness programs.
However, many employees feel ill-equipped to make these decisions.
They may be uncertain which insurance coverages they need, how to select investment funds for their 401(k) plans and whether they qualify for perks like tuition reimbursement. What’s more, workers may be dealing with financial stress at home related to debt, medical bills or limited income.
“Today, we have several generations in the workplace, all with different financial situations,” says Jim Cichanski, founder and chief human resources officer of Flex HR.
Employers are increasingly seeing it as their role to help workers maximize benefits and navigate financial challenges.
By 2026, nearly half of employers expect to offer their workers a comprehensive financial wellness program, according to the Transamerica Prescience 2026 report.
Basics of Workplace Financial Wellness Programs
Financial wellness programs can vary significantly by employer.
“It starts with the employee and what they need,” says Sumeet Grover, chief digital and marketing officer at Alliant Credit Union, which curates financial wellness programs for partnering employers.
Programs may include the following components:
— Seminars
— Workshops
— Online tools
— Budgeting apps
— Emergency assistance programs (EAPs)
[Related:Are Budget Apps Safe?]
Seminars and workshops may address specific topics like saving for college or how to invest money in a 401(k) plan. Some employers give workers the option of scheduling one-on-one calls with financial advisors while others limit their offers to prerecorded webinars employees can watch at their convenience.
Grover says some programs bring in influencers who seem to be popular with workers. For instance, Alliant Credit Union has helped facilitate opportunities for employees to participate in Q&A sessions with financial influencer Suze Orman.
“Employee assistance programs are probably a must nowadays,” according to Cichanski. He has seen firsthand how these programs can connect workers in financial crises to resources that alleviate their immediate problems.
“When you think of financial wellness, it’s not just the 401(k) and the HSA (health savings account),” says Jeri Hawthorne, chief human resources officer at Aflac.
[READ: What Is a Health Savings Account?]
She points to the on-site and telehealth medical care options available to her company’s workers and notes that by making it easy for people to access health care, they may be able to avoid costly visits to urgent care facilities or emergency rooms.
No matter how they’re structured, the ultimate goal of financial wellness programs is to help employees have a better understanding of how to manage money and use available resources.
“It’s really about how do you become an educated consumer about the benefits you’re offered,” Hawthorne says.
Why Employers Promote Financial Wellness
About half of workers believe employers have a responsibility to help them maintain and improve their financial wellness, according to the TIAA 2022 Financial Wellness Survey. But these programs have benefits for companies as well.
“It’s usually all wrapped around that word retention,” Cichanski says. Financial wellness programs are seen as a way to encourage employee loyalty.
Plus, it can be helpful for a business’s bottom line. Hawthorne notes that employees often perform better and are more productive when they are less stressed.
“(Companies) want their employees engaged,” Grover says. “They want their employees not stressed over finances.”
Financial wellness programs also often come at a minimal cost to employers. For instance, a 401(k) administrator may include free tools and advisor access as part of its services. Or, an insurer may provide a complimentary seminar to outline its offerings.
[Read: 401(k) Mistakes Job Hoppers Make.]
About a quarter of panelists surveyed by Transamerica for its report expect the cost of financial wellness services to be covered by a benefits provider and included in their standard services. Another quarter thought costs should be shared by employees and employers, while 37% believed any fees should be paid entirely by an employer.
“Even if it costs money, it’s well worth it,” Cichanski says, since lower employee stress can ultimately boost a business’s efficiency.
Employee Participation Is Often Low
While financial wellness programs sound good on paper, they often don’t live up to expectations in the real world, according to Rebell.
“These programs are well-intentioned, but a small fraction of people are actually using them,” she says.
Rebell relates a conversation she had with a person creating webinars for a global business. Despite efforts to promote the company’s financial wellness offerings to its large workforce, only nine people watched the most recent educational video.
From her perspective, a significant drawback to many financial wellness programs is that they lean heavily on automated components that require workers to access them on their own. Most workers don’t have the luxury of spending an hour during the workday to watch an online seminar, and evenings may be filled with other activities.
“You’re asking workers to do this on their own time, but they’re busy,” Rebell says.
She believes the answer is to have more live, or least hybrid, events that are scheduled with worker convenience in mind.
For instance, her company offers 40-minute “office hours” that enable employees to submit anonymous financial questions in advance. Those are then answered live during a group session. Not only does this provide a way for workers to get answers to their questions, they may hear questions that had never occurred to them before.
“By having a live event that feels like a break from work, employees don’t feel like this is a lecture or a task added to their workload,” Rebell says. The community aspect of logging in at the same time as co-workers can also provide accountability and motivation.
At Aflac, Hawthorne says offerings are tailored to each segment of its workforce. For instance, call center staff is invited to lunch programs while professional workers who have more flexibility may be encouraged to schedule one-on-one conversations to address benefits questions.
“Companies need to meet employees where they are,” Hawthorne says. “I think it’s important for companies to ensure employees have the flexibility to go to (educational programs).”
Future of Financial Wellness Programs
As more companies turn to financial wellness programs, the scope of their offerings may expand as well.
“We feel there are more tools now than ever,” Grover says.
The challenge may be finding those that are truly beneficial for workers.
Handing out fitness trackers to employees and offering incentives to use them may do more to reduce both employee and employer health care costs than a recorded webinar on healthy eating, for example. In personal finance, getting one-on-one assistance to make a budget may be more effective than using an app.
Rebell also cautions that free offerings from benefits providers may be more about drumming up business than assisting workers.
“That free program is often a sales pitch,” she says. A company that meets with employees to discuss their 401(k) accounts, for example, may also be trying to sell workers other financial products.
The challenge for financial wellness programs going forward seems to be twofold.
For employers, it’s about finding the right mix of programs and services for their workforce and then making sure workers know about them. Then, once available, employees need to carve out time to use those resources.
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Do Employer Financial Wellness Programs Really Work? originally appeared on usnews.com
Update 08/29/24: This story was published at an earlier date and has been updated with new information.
