Financial wellness solutions are becoming increasingly popular with businesses looking to attract and retain top talent, increase employee productivity, reduce absenteeism and presenteeism, and decrease health care costs. Many financial services companies currently claim to offer a financial wellness solution. But some offer little more than an online retirement calculator.
While financial wellness as a field of study is still relatively new, much can be learned from previous research on behavioral change via workplace health and wellness efforts. Here are four tips for HR and benefits managers to consider in choosing an authentic, effective financial wellness solution.
1. What are the components of the program, and how holistic will it be?
Most company benefits packages offers more than a retirement plan, and an authentic financial wellness solution should be just as comprehensive–covering all of employees’ financial needs. A good solution will also provide guidance on the value of any current benefits, promoting their advantages and ultimately, improving employee participation.
It’s also important to distinguish web-only platforms/solutions from those that also offer truly personalized advising from a live financial planner. The ability for employees to have access to advisors or coaches via personal contact by phone, video call or chat, email, or in person, is critical to increasing employee participation and changing financial behaviors.
Research attempting to quantify the ‘value add’ of financial planning prospectively followed a matched sample of people who met with a financial advisor and those who did not. Respondents who met with a financial advisor were more likely to subsequently establish long-term goals; calculate their retirement needs; establish retirement accounts and emergency funds; display appropriate investment responses to a recession; and have greater retirement confidence.
And it’s important that employees get ethical, unbiased advice to help them make the best decision for their individual situation. A solution that offers access to Certified Financial Planners™ does just that. A CFP® acts as a fiduciary, giving objective financial advice with complete transparency, and always in employees’ best interests.
2. Make sure communication with employees goes both ways. Occupational health research has shown that workplace wellness initiatives for improving health are more successful when employees are able to share their thoughts on what they find useful. Gathering feedback and input from employees about their perceptions surrounding financial wellness, their needs, interests, and barriers is important information for introducing or refining the program and for giving employees a sense of ownership.
And to ensure that communications reach employees, employers can tailor communications to employee demographics, employ multiple channels of communication, especially social media, and make communications simple and meaningful for the target audience. Do establish a feedback loop to tell if and how well communications are being received.
3. Be sure employees know that their participation is private, secure, and available when they need it. Most of us consider financial information to be highly personal and private, and everyone is conscious of the importance of keeping financial data secure. A good financial wellness solution will provide company-level data while keeping the financial needs and personal information of employees anonymous. It can also promote participation when the solution is available via desktop or mobile device, so that employees can manage their finances when it’s most convenient for them–anytime, anywhere.
4. Make sure evaluation of any proposed program is part of the initial plan. You can’t determine whether the program is succeeding if you haven’t decided how to assess it ahead of time. An effective financial wellness solution should assess actual results and positive financial behavior changes that provide employees with positive reinforcement while providing data to you. However, outcomes may not be as apparent or easy to quantify as healthcare and retirement benefits. So it’s even more important to be clear about how you plan to evaluate the program before implementing it. Realize that you will want to include quantitative measures complemented by more qualitative data such as individual success stories. It’s also important to evaluate a program periodically during its implementation, so that improvements can be made early on to help the program be successful.
Currently, according to Aon Hewitt, 85% of employers are focusing on adding financial wellness as a benefit ‘because it’s the right thing to do.’ In addition to doing the right thing, effective financial wellness programs can help companies significantly reduce costs, attract and retain top talent, and boost employee productivity. The key is to choose an authentic, effective program that offers more than webinars and calculators, and focuses on helping employees adopt healthy financial behaviors.