With many American workers distracted and often missing work because of financial issues, employers are getting some guidance on how to help.
The Center for Social Development (CSD) at the Brown School of Social Work has partnered with Prosperity Now (formerly CFED) to produce a guide for companies: “Workplace Financial Wellness Services: A Primer for Employers.”
Financial wellness services are often focused on saving for retirement. Researchers at CSD, however, say such services also could help low- and moderate-income workers in need of immediate help, such as financial counseling, short-term loans or accrued wage advances.
“Low- and moderate-income workers worry about managing day-to-day expenses, paying down debt and building emergency savings,” says Meredith Covington, project director of Employee Financial Wellness Programs research at CSD. The primer provides employers an overview of workplace-based financial wellness services that can be tailored to serve the needs of such workers, she said.
Financial counseling is designed for people in crisis who are, for example, overwhelmed by credit card debt or facing foreclosure. Financial coaching can help employees set goals for the future and improve their financial standing.
Some organizations are going beyond that and partnering with services that offer direct loans to their workers.
“I believe this benefit saves them from predatory lending,” Joyce Norals, chief human resources officer at Lutheran Social Service of Minnesota, says in the primer. “A lot of our employees are part time and may have limited resources.”
With the loan benefit, employees with low credit scores are able rebuild their creditworthiness, Norals says. Loan payments may be automatically deducted from employees’ pay.
For human resource managers, financial wellness services are a way to keep their workforce focused on their jobs rather than worrying about unpaid bills. Fifty-three percent of employees in the U.S. found dealing with personal finances stressful, and 42 percent found it difficult to meet their household expenses on time each month, according to PricewaterhouseCoopers’ 2017 Employee Financial Wellness Survey.
Meanwhile, one in five employees struggling with both short-term and long-term finances is in poorer health than other workers, according to a 2016 survey by Willis Towers Watson.
Financial wellness services may help companies, too, by improving their image among employees and increasing job satisfaction among employees.
The primer was made possible by a grant from JPMorgan Chase & Co.
CSD and Prosperity Now also are launching a Workplace Financial Wellness Service Directory this fall to coincide with the September 19 conference Catalyzing a Financially Stable Workforce: How to Choose the Right Financial Wellness Program for Employees.
The conference, at Washington University in St. Louis, if free and open to the public. More information and a link to register is available here.