3 Areas Where Employee Financial Wellness Can Affect Your Organization

Perhaps not surprisingly, the latest PwC Employee Financial Wellness Survey found that 40% of full-time employees said their top financial pressure is that everything costs more these days. Only 42% said their compensation is keeping up with the rising cost of living expenses (down from 52% in last year’s survey). 

Now in its 11th year tracking the financial well-being of U.S. employees, the survey identified three critical areas that employers need to focus on in order to solve employee challenges like this. Doing so can have a significant impact on your organization’s culture, and ultimately your bottom line.

Retention

Last year, a desire for a less stressful position and the ability to work remotely were the primary drivers for changing jobs. The 2022 survey results indicate it’s money. Among the 29% of employees currently looking for a new job, 65% cite money as their primary reason.

Positive Bottom Line Steps to Consider: Given the high cost of employee turnover (including recruiting and training plus the loss of institutional knowledge) employers can show they care about employee financial well-being by promoting benefit programs that help

employees stretch their money further. That includes:

• Student loan paydown plans (more than one-third of survey respondents who are currently looking for a new job have student loans).
• Financial coaching focused on areas where people need immediate help: budgeting, paying down debt and building an emergency fund. Employers might consider an employee survey on topics of interest.

Mental Health

Among financially-stressed employees, 49% said that money worries had a severe or major impact on their mental health in the past year. These employees are nearly twice as likely to say that one-on-one financial coaching via phone or video chat is extremely helpful, likely because of the intimate and confidential nature of their financial issues.

Positive Bottom Line Steps to Consider: Money problems can be a big driver of mental health issues that have the potential to impact an employer’s bottom line in key areas like productivity, retention, attendance and overall engagement. Given the connection between financial wellness and mental health, employers may want to consider offering financial coaching that promotes confidentiality alongside their mental health resources.

Productivity

Among employees who say that their financial worries have had a severe or major negative impact on their productivity at work, 67% are struggling to meet their household expenses on time each month, 71% have personal debt, 64% are using credit cards to pay for necessities, and 25% have saved less than $1,000 for retirement. More than half plan to postpone their retirement.

Positive Bottom Line Steps to Consider: Survey results indicate that half of financially-stressed employees spend three hours or more each week dealing with personal money issues during work time. Employers who continually promote financial wellness resources to help alleviate stress have the potential to reap tangible gains in employee focus and productivity. Budgeting, debt management and building an emergency savings account could be considered as mandatory learning modules that can be completed on company time.

DISCLOSURES

Investment advisory services offered through TCG Advisors, an SEC registered investment advisor. Insurance Services offered through HUB International. Part of this material was prepared by Broadridge Investor Communication Solutions, Inc and Seven Group, Inc. Although the information in this blog has been compiled from data considered to be reliable, the information is unaudited and is not independently verified. 

Tax services offered through RPW Solutions. TCG Advisors does not provide tax, legal or accounting advice. This presentation was prepared for information purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisor before engaging in any transaction. 

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TCG.45.2022