With Thanksgiving fast approaching, it’s time to give thanks for the new focus on financial wellness and the positive impact the movement is having on the retirement plan marketplace. Few lifestyle trends have ever impacted retirement savings more than this relatively new phenomenon.
Financial wellness is a simple concept: instead of focusing on individual money issues, people consider the big financial picture from a mental, spiritual and physical aspect. This holistic approach means creating a new financial attitude that considers satisfaction, financial situations, and actions.
The impact of solid financial wellness programs in the workplace is huge. Properly implemented, these programs help employees assess their financial wellness levels in all areas of their lives, while giving them the tools they need to help meet their financial goals. Providing ways to relieve financial stress is not only good for your employees, it’s also good for your bottom line. Employee stress can negatively impact many areas in your business, including:
• Employee health and well-being (and medical costs)
• Worker productivity
• Apathy and disinterest in work and the workplace environment
An employer-sponsored financial wellness program can make a difference. Here are the key steps for developing and implementing a financial wellness plan:
• Culture — The plan must be incorporated into the overall employee benefits plan
• Commitment — This is not a one-time event. A financial wellness program requires ongoing education and multiple education channels to reach employees.
• Employee education and guidance on the following key points:
o Debt reduction
o Estate planning
o Root causes behind poor cash management and how to make changes
o Multi-generation responsibilities and the financial impact
o 401(k) retirement plan benefits
Clearly traditional financial education programs are not enough. Today, multiple stress factors mean people need help on multiple financial fronts in order to live better today and into retirement. This Thanksgiving, help your participants by promoting the importance of financial wellness in their lives and by providing actionable ways to help them make the most of their 401(k) plan.
For more information on financial wellness programs and the impact they can have on a retirement plan, check out this 401k Help Center article that cites new industry research and best practices.