Offering financial education in the workplace is a practice that is growing and gaining acceptance in organizations big and small. Employers understand there is a correlation between positive financial health and emotional and physical wellbeing. With many companies giving close attention to their corporate social responsibility agenda, financial literacy and wellness is making its way into workplace culture.
According to Aon’s 2016 Hot Topics in Retirement and Financial Well-Being report, 55% of employers already offer help in at least one category that falls under the umbrella of financial well-being and 38% have at least three categories covered. By the end of the year, these percentages are expected to grow to 77% and 52%, respectively.
There are several factors influencing employers’ decisions to introduce financial education programs into their workplace:
- A number of 401k investment options that require better member understanding
- Workforce planning to help people retire
- Broader focus on employee wellbeing
- Proactive management of employee benefit options and healthcare cost containment strategies
Many employers realize that there are employees at every stage in their careers that have some financial behaviors that need changing. Providing employees access to quality financial programs that go beyond simply discussing employee benefits packages and address how key decisions must be made and how to integrate employee benefits into the broader picture of financial wellbeing will make the most impact in their employees’ lives.
With such high expectations riding on the implementation and success of these programs, an important piece will be the measuring outcomes. While employers may look at before and after data for absenteeism, payroll advancements, turnover, and health care costs, employees need to look at different factors like a change in their spending and saving behaviors, financial knowledge, or socioeconomic conditions.
There are new tools available that can help improve the validity of assessing financial education programs. The September issue of Benefits magazine lists three free evaluations that employers should consider to ensure their program is committed to the industry’s best practices.
Financial Fitness Quiz – A free online quiz offered by the New Jersey Agricultural Experiment Station at Rutgers University asks participants 20 questions about money management, credit, insurance, estate planning and shopping. Based on the responses a score is tabulated regarding the participant’s financial well-being. njaes.rutgers.edu/money/ffquiz
Financial Well-Being Scale – The Consumer Financial Protection Bureau offers a free 10-question questionnaire that measures workers feeling of empowerment, confidence, and satisfaction with his or her financial status. http://www.consumerfinance.gov/data-research/research-reports/financial-well-being-scale/
Financial Evaluation Toolkit – Available from the National Endowment for Financial Education this free online kit provides a database of evaluation templates and forms for several different aspects of a financial program. Questions test workers financial knowledge on a range of topics and their current financial situation. toolkit.nefe.org