In the last couple of years, the term Financial Wellness has been used to describe the relationship between money, money-related issues and overall well-being. Financial Wellness involves the process of learning how to successfully manage financial expenses; not having enough money impacts our health as well as our financial performance. Financial stress is commonly found to be the source of stress, anxiety and fear.
Companies have started to recognize the importance of Financial Wellness and invest in it since it leads to a happier, more productive workforce. A well-conceived Financial Wellness program will not only reduce healthcare expenditures and absenteeism rates, while increasing productivity, but it can also help employers attract and retain top talent. Here are a few reasons why Financial Wellness is important in the workplace:
- Finances are a major cause of stress: A 2015 report conducted by the American Psychological Association found that 72% of adults feel stressed about money at least some of the time, 22% experience extreme financial stress and individuals in lower-income households with extreme financial stress are more likely to engage in unhealthy behaviors to manage that stress (i.e. watching TV for hours, ice cream binging and drinking one too many to manage that stress).
- Managing Finances take time: The lack of control of your financial health leads to employees bringing their worries into the workplace. According to a survey recently done by PricewaterhouseCoopers, 37% of the people surveyed said they spent 3 or more hours at work each week thinking about their personal finances; some employees even missed work due to money worries. Stress is distracting, and when employees worry about their Financial Wellness, they lose focus and are less productive in the office.
- Employees want Financial Wellness Support: Employees want their employers to help get rid of the financial burden by offering financial planning benefits. Employers that provide Financial Wellness and regular salary increases often shows employees that the organization cares about them as individuals, which results in loyalty, motivation and more engagement. Investing in Financial Wellness also boosts the overall well-being of employees, increasing their health, productivity and engagement.
Financial Wellness isn’t a new concept, but by finding better ways to take care of our finances, ultimately we will find healthier ways to take care of ourselves.