How a Financial Wellness Benefit Can Grow Your Company’s Retirement Investment
It’s no surprise to find that financial stress is rising among American workers, but what might surprise you is how large an impact it’s having on your company’s bottom line. New research shows the better employees feel about their personal finances, the more likely they are to become active with an employer-sponsored retirement plan.
Financial Stress Hurts Business
How many people does your business employ today? Take that number and multiply it by $413. That’s about how much financial stress is costing companies per employee every year, according to a study released by Lockton in 2016. Even smaller employers are likely losing hundreds of dollars daily due to high levels of financial stress on their teams.
To understand more about how your team’s financial stress may be harming your own company, consider a few more numbers from the research. People who reported feeling high levels of stress:
- Are more than four times as likely to also report depression, headache, fatigue or other stress-induced ailments
- Take prescription medication to manage chronic illness at a rate three times higher than their less-stressed peers
- Use sick time, even when not ill, at double the rate of other employees
Workers are finding it harder to leave money stress at home. Those troubles follow them to the workplace, sometimes even preventing them from being more fully engaged in the business at hand.
The Business Benefits of Wellness
Despite the worrisome findings about the negative impact of money stress on employers, the same study included some good news too.
Rates of investment in company retirement plans are a great example of the holistic benefits of greater financial wellness. While only 60% of high-financial-stress employees are enrolled in an employer-sponsored plan, nearly all those who report low stress are investing (96%).
And in a related finding about retirement plan participation, the research showed that it’s a major influence on how hopeful employees feel about their finances. Hardly any employees said that having such a plan “does not at all” allay their worries about money (4%), while over half agreed that investing eases their financial concerns.
Financial Wellness Is a Win-Win Idea for Companies and Their Teams
When workers are mired in debt and living from paycheck to paycheck, the stress of that situation reduces their engagement at work and can even harm their employers’ business prospects. But when employees take control of their money, stress gets replaced by hope. Engagement rises not only with work duties but also in company retirement plans.
But research shows the best wellness benefit is one that takes the employee’s whole person, especially their behavior, into account. Such a program needs to help beneficiaries to see the link between debt and stress as well as the tie between being debt-free and higher engagement in retirement plans.
Providing a holistic financial wellness benefit is a win-win proposal for your company and your employees. Not only will greater financial wellness improve your employees’ sense of well-being, it will also strengthen your bottom line.