Financial stress is more common in the workplace than you might realize. According to statistics, 53% of adults are worried about their Financial situation, while 78% of American adults live paycheck to paycheck. While this might appear as a personal problem for some, it can negatively impact your workforce. When employees face a challenging financial situation, they are more likely to miss work and perform poorly.
Therefore, as employers, it's crucial to focus on improving the financial education of your employees to help them gain the confidence to enhance their well-being without losing focus at work. Being financially literate can also help them better manage their finances and prevent them from ending up with financial woes. In return, you will get a higher employee loyalty and retention rate, which can be cost-effective in the long run.
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However, Financial Literacy programs are not just about teaching your employees how to budget or save better. It's more complicated than that, especially if you want long-lasting results.
Why Should You Educate Your Employees About Financial Literacy?
Everyone wants to be financially literate, but the lack of education prevents them from doing so. According to Standard Poor's Global Financial Literacy, 57% of American adults are still illiterate when it comes to finances. And when an individual doesn't know how to budget better or save more, it could lead to a rise in personal debts and loans, car repairs, and medical bills. The combination of these two—excessive debts and financial illiteracy—could transcend their ability to contribute and focus on their work.
Thus, changing your employees’ money mindset for the better could help in building their future and removing potential stressors they can carry over in the workplace. It could also help them understand how to navigate essential decisions in their finances, such as taking out loans, investing in retirement, and purchasing real estate.
Financial literacy also has a positive impact on your business. Nearly 50% of employees state that their financial stress keeps them distracted from work. And providing a program that will help them deal with their money issues will allow your business to boost productivity at work, improve focus, reduce stress and absenteeism, improve employee retention and loyalty, and attract top-level talent.
How To Teach Your Employees Financial Literacy
A successful financial literacy program is personal and comprehensive for your employees. It provides a clear picture of their financial health and what support they need. However, it is not a one-size-fits-all approach as many things affect a worker's money situation, such as gender, age, and socioeconomic background. As an employer, it is best to create an individualized approach when developing such programs. But where do you get started? Here are four steps you can consider to support and empower your employees.
Establish your goals
Identifying your goals for the program is the first step to creating an effective financial literacy program. Is lowering absenteeism more essential to you than boosting productivity? Or do you want to give your employees a solid reason to stick with your company? Setting program goals will enable you to monitor progress over time.
Learn about your employees' financial concerns
Once you've established your goals, determine the topics your program will cover. The best way to do it is to conduct a survey and ask your employees what they want. Understand where their struggles are coming from by sending out a simple survey and see what topic they're interested in discussing, such as:
- Paying off debt
- Loans and credit management
- Investment strategies
- Retirement plans
- Saving and budgeting
- Spending management
You can also utilize the data you already have when building your program. For example, millennials may be interested in paying off student loans or saving up for a house, gen X workers could be interested in college savings for children or credit card management, and baby boomers are more focused on retirement opportunities.
Design the program
Now that you've chosen your topics, it's time to design the program. Give your employees access to resources and information by creating your own employee financial wellness program or using one from a third party. Programs for improving employee financial literacy can take many different forms, like workshops, online groups, or one-on-one consultations with experts.
The following are common elements of financial wellness programs:
- Websites that offer tools and content
- Supplying calculators and charts as interactive tools
- Access to financial advisors
- Lectures and classes
- Financial planning
Make sure to personalize your design program to make your employees feel that the program is about them and it exists to give solutions to their problems. Also, it is essential to determine whether the program is mandatory or not.
Establish a transparent support culture
Make an effort to establish a visible and transparent culture of support. Debunk the "money script" that discussing money is unacceptable by doing your share to minimize stigma and encourage open discussions about financial literacy. Set a good example for your staff by demonstrating the value of financial knowledge and openness. It will enable them to manage their financial stress and foster a more productive workplace.
Businesses must do more than pay their employees to remain competitive. A supportive corporate culture is the first step to consider when attracting and keeping great talents. Following the tips we mentioned above will be beneficial in actively helping your personnel reach their financial objectives, ultimately leading to long-term business success.
This post first appeared on 4Cs Blog: Employee Surveys And More | Insightlink Communications, please read the originial post: here