James Reid is Executive Vice President and head of MetLife Global Employee Benefits at MetLife, Inc. He has more than 25 years of experience in health and employee benefits. He also has held several leadership roles within MetLife’s US Group Benefits organization, including spearheading Regional and Small Business Solutions.
For many employees, stressors like bills or debt linger in the back of the mind like an overplayed pop song—and the insidious distraction can be a serious strain on their wellbeing.
During my time working in employee benefits, I’ve witnessed the profound impact that financial uncertainty can have on employees. MetLife’s 17th annual US Employee Benefit Trends Study (EBTS) reinforces my observations: the study, which surveyed more than 2,600 full-time employees, found that workers across all generations, life stages, and socioeconomic statuses cited “personal finances” as their number one source of stress. What’s more, one in three respondents admitted their work productivity has been impacted due to financial stress.
There’s also a disconnect between how workers feel about the state of their financial wellness and the reality of their situation. While 63% of employees reported feeling confident about their finances, half admitted living paycheck to paycheck.
Hidden in these statistics is a window of opportunity for employers and HR managers. Financial wellness programs can do more for your workforce than simply lessen stress levels—they can have a ripple effect that translates into improved engagement, loyalty, happiness, and productivity on the job.
A holistic approach to employee wellness
The lines between personal life and work environments are blurring thanks to shifting societal trends—technology that keeps us connected 24/7 and the rise of remote work, for example—and in turn wellness programs are becoming an imperative for employers to help workers manage this new “work-life” world.
While many people think of free preventative medical care or office yoga sessions when it comes to workplace wellness programming, there’s evidence that financial wellness should be part of a holistic approach to such employee benefits. The EBTS revealed that 80% of workers want access to financial planning tools or workshops, yet employers are not acting on this demand, with only 20% currently offering such programs.
A well designed financial wellness program can even make a difference on bottom lines. A 2017 report calculates that for an organization of around 10,000 employees, stressed workers cost around $250 billion annually in lost revenue. This metric provides only a sliver of the scope of damage: employees also experience high rates of absenteeism, turnover, dissatisfaction, and disengagement when burdened with financial worries.
Ingredients for an effective program
Financial wellness programs come in a variety of formats, depending upon the size and nature of a business, yet all companies can follow a few simple guidelines.
First, I recommend performing an audit to understand your employees’ needs more fully. These assessments should consider factors like how much they contribute to retirement funds, if they have outstanding loans, what life events they want to save for, etc. Then, use those insights to create your action plan. This approach may have long-term payoff: one of the study’s top insights is that when employees feel more supported as individuals, they’re more engaged.
Making financial wellness programs both enticing and actionable is another key component. Implementing a solution with a multi-pronged approach to engagement allows employees to engage on their own terms. Whether in person, online, or over the phone, they should be able to access programming or support to help them master daily budgeting, prepare for unexpected expenses, and tackle long-term savings—another area where workers are woefully underprepared. The study found that nearly one-third (30%) of employees with a defined contribution retirement plan, like a 401(k) plan, had dipped into it prematurely.
There’s ample evidence that indicates reducing financial stress adds to the satisfaction employees feel at work. According to the study, 88% of employees reporting to be on track with their financial goals stated they were “satisfied with the job they have now,” and 85% noted being “committed to their organization’s goals”—versus 56% and 61%, respectively, of workers who reported a lack of financial stability.
Financial stress takes up too much of a precious and finite resource: your employees’ time and attention. A thoughtfully developed financial wellness program can help get their minds off of money stress and back on track toward a happier and healthier life, both in and outside the office.
Read the full 2019 US EBTS report to learn more about MetLife’s insights for helping your employees thrive in the new “work-life” world.
This article was produced on behalf of MetLife by Quartz Creativ