A significant part of the U.S. workforce is facing a financial crisis, largely due to the steady increase in the cost of living. Prices have soared in nearly every aspect of life—from housing and groceries to transportation and daycare.

Inflation has risen to a 40-year high, and a recent analysis of government data found that the typical American household must now spend an additional $11,434 annually to maintain the same standard of living they enjoyed in January 2021.

Today, 6 in 10 Americans are living paycheck-to-paycheck. Many are only barely able to afford basic necessities despite taking on multiple jobs to try to boost their incomes.

Fortunately, more companies are responding with targeted wellness programs designed to address the dire financial challenges their workers face.

What are Financial Wellness Programs, and Why are They Important?

Corporate financial wellness programs are geared to help employees build a healthy relationship with money, adjust their lifestyles to better accommodate inflation, and make their work and home lives more stable and fulfilling.

This not only benefits employees and their loved ones, it’s also good for business. Workers’ financial stress can result in lost productivity, reduced engagement, and increased healthcare costs. By providing financial wellness programs, companies can expect higher employee productivity, attendance, engagement, and retention.

Let’s explore how financial wellness programs can be successfully implemented.

7 Steps for Building a Financial Wellness Program

1. Commit to Building a Financial Wellness Program that Meets Diverse Employee Needs

Your financial wellness program should be designed with flexibility in mind. After all, every employee at your organization does a different job, has different personal circumstances, and a different financial life.

Too often, company financial wellness programs are designed for workers with higher incomes and more education. As a result, their focus is skewed toward financial topics like planning for retirement or refinancing a home loan. But low- and moderate-income workers are typically under more immediate financial stress and need help with things like managing their day-to-day expenses and building an emergency fund.

Age is also a factor. Entry-level hires who are fresh out of college probably care more about their student debt than retirement savings. Many of your Millennial employees may be preparing to have children and buy homes. Gen Xers will likely be concerned about financing college educations for their children and growing their retirement funds. Baby Boomer employees are probably most concerned about managing their assets throughout retirement.

The best financial wellness programs will offer customized options for every type of employee.

2. Assess Employees’ Financial Needs, Fears, and Concerns

To craft the right solution, you first need to identify the problem. The best way to gain insight into your employees’ most pressing financial challenges is through a confidential, company-wide financial survey.

This approach ensures that your people have a safe space to share what’s on their minds, and you’ll receive honest and accurate feedback about their needs and concerns. Here are a few questions to consider when designing your survey questionnaire:

• What are your current day-to-day stress levels in and outside of work?
• Have you struggled financially in the last 12 months?
• How many times have you felt stressed about your finances within that same time frame?
• What kind of debt do you have?
• Are you currently able to save any money from your paycheck?
• Do you think any of the above issues have impacted your job performance?
• How do you feel about your current knowledge of personal finance?
• What type of financial resources, tools, and education would you find most useful?
• Which employee assistance programs would you enroll in, for example, one-on-one counseling, debt management, etc.?

In addition to surveying employees directly, you might also consider talking to your managers and your HR department to gain additional perspectives on your workers’ financial needs. As the primary points of contact with your employees, they can provide insights that you would not otherwise have.

Analyzing other financial security behaviors and indicators that suggest that your employees may be experiencing financial difficulty is another good idea. Look at your employee data to see if you can spot any of the following:

• A high percentage of workers requesting advance payments.
• Few employees using direct deposit.
• Low retirement plan enrolment rates.
• Absenteeism or low productivity, which could be the result of financial stress.
• Increased turnover, which might suggest people are seeking better pay elsewhere.

3. Design Your Financial Wellness Program

Financial wellness programs will vary in options and scale depending on the company’s size, budget, and number of employees. But at the very least, your solutions should offer employees the following:

• Financial Education: Financial wellness courses and other learning materials that educate people about important topics, such as saving for emergencies, preparing for retirement, and understanding credit scores and interest rates.
• Financial Wellness Tools: Interactive solutions that employees can use to make financial decisions, such as digital budget trackers, debt calculators, and savings dashboards that provide easy goal setting and tracking.
• One-on-One Counseling: Confidential sessions where employees can work through tricky personal financial issues with qualified financial coaches or advisors.
• On-Demand Pay: Workers have immediate access to the wages they’ve already earned instead of having to wait for traditional weekly, bi-weekly, or monthly payment schedules.

Also, bear in mind that one of the keys to a financial wellness program’s success is making it easy for both the employees who use it and your HR team who manages it. Look for a solution that easily integrates with your HRIS to limit the administration burden involved in deployment and support.

4. Secure Leadership’s Buy-In and Support

Members of the C-Suite and other executives are a company’s most influential stakeholders.  Therefore, they must appreciate the connection between employees’ financial well-being and the organization’s overall success. That means they need to be genuinely enthusiastic about supporting and implementing employee financial wellness initiatives.

Employees may trust a financial wellness program more if someone they trust recommends them and tells them about their own experiences with it. So, let managers and supervisors try out your financial wellness tools and resources themselves first to ensure they can give employees plenty of helpful, first-hand information and support.

You’ve asked your employees for their input, crafted your employee financial wellness program, and perhaps even requested your leaders to test it. Now, it’s time to launch and communicate it.

5. Implement the Program Effectively

The effectiveness of employee financial wellness programs depends on your ability to spread the word, reach every employee, and inspire their participation. You’ll need to establish the ideal channels for getting the word out. This might be a combination of emails, announcements in all-hands meetings, monthly newsletters, and weekly huddles.

An employee communication app is a great tool for centralizing and optimizing the flow of company information. Because they allow people to receive alerts and updates from their smartphones, you can be sure that everyone (including remote or on-the-go workers) gets the information they need at all times, wherever they are.

Be sure to integrate your financial wellness program into your usual benefits onboarding procedures and remind your workers of it during specific times of the year, such as open enrollment.

6. Collect Feedback from Employees and Analyze Results

Supporting employees’ financial well-being is an ongoing effort. Measure the success of your initiatives over time by examining KPIs like:

• Employee engagement levels/enrollment rates.
• How many times they use the resources you provide.
• Program satisfaction ratings.
• Changes in employees’ financial behavior, such as debt and savings levels.
• Lower financial stress levels among your workforce.

Additionally, look for changes in absenteeism, retention, and productivity rates to see if there’s any correlation between your financial wellness initiatives and other aspects of employee engagement.

7. Evaluate and Adjust the Program Over Time

Now that you’ve introduced your financial wellness program and gathered some data about your success, it’s time to examine what you can do to improve.

For example, by looking at your usage and adoption rates, you can clarify who is using the programs and who isn’t and investigate the “why” behind it. Was it a communications problem? Perhaps news of the program failed to reach a particular group of workers. Or did the program not match the needs of some workers? Again, your managers and supervisors can be a good resource here.

Also, ask your employees what they like about your financial wellness program and what could be better through a follow-up confidential survey.

At the end of this exercise, you’ll know who is using your financial wellness tools and resources, who isn’t and why, and some ideas for improvement. You can then adjust your strategy to better address your employees’ evolving financial needs and preferences.

Payactiv—Your Partner in Building Employee Financial Wellness

When your employees have good financial health, they can better focus on their jobs and make meaningful contributions to your organization.

With Payactiv’s Earned Wage Access, budgeting and smart savings tools, financial counseling, and discount marketplace, all in the Payactiv app, we’re helping employers across the U.S. ensure their workers are empowered to take control of their financial futures.

Speak to Payactiv about building a robust employee financial wellness program and offer our tools to help your employees advance toward long-term financial resilience.

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