Constructing a great employee benefits package can have a tremendously positive influence on current and…
A recently released article published on PlanAdviser evaluates the effectiveness of the financial education programs that employers are offering to their employees. Quoting Questis’ senior researcher, Dr. Martha Brown Menard, the piece delves into why the majority of these programs aren’t working to change employees’ financial behavior. Further, the article explains that by tailoring these programs to meet specific goals of each individual, employers could improve their employees overall financial wellness. Below is an excerpt from the article:
“It’s challenging for employers to deliver personalized financial advice,” Menard admits. “They have limited resources and opportunities for addressing a large population that spans multiple demographics and that are experiencing diverse life events and needs. And we know now that financial education alone doesn’t change behavior. It needs to be integrated into a more comprehensive approach to financial wellness.”
Financial technology is the key to delivering tailored education, Menard maintains. “Financial technology holds a lot of promise and is just starting to deliver,” she says. “It’s possible to use existing technology now, and machine learning/artificial intelligence going forward, to deliver more personalized advice to meet people where they are. We know people are more motivated to take action when information presented to them is relevant to their immediate situation, with concrete suggestions on how to take action.”
This needs to be paired with access to financial advisers who can provide financial coaching, Menard says.
“Ideally, financial wellness programs can be personalized by people, who can coach and encourage, and at the same time be fueled and scaled by technology,” she explains. “Coaching employs techniques that are consistent with the concepts and principles of effective behavioral change. A relatively new entrant to the coaching field, financial coaching differs from traditional financial advising in that it tends to focus more on client-centered goals to guide the process, rather than only providing specific expert advice or recommendations.”
This means setting goals, creating concrete action plans, building motivation and providing accountability, Menard says.
Find the full article from Plan Advisor, here.