Regional Market Outlook on Workplace Financial Wellness

In the US, approximately 83 percent of the employers offer financial wellness programs to their employees. 57 percent of the employees have stress dealing with their financial situations. The top sources of stress cited include both immediate and long-term concerns about their finances are: Saving for the future (67 percent), paying monthly bills (57 percent), and credit card debt (42 percent). Generation X employees are more stressed than the millennials and baby boomers.

Industry Trends

Most financial wellness programs are implemented as on a need basis or is integrated with the employee benefits. Employers are trying to include financial wellness as a part of the core benefit offering either being provided by Insurance providers, wellness firms or consulting firms

  • Digital portal through which all tools and content can be accessed is been provided more by employers
  • Tools and calculators to help employees gauge their financial wellness follows next

Popular Financial Wellness Programs are:

  • Debt management services
  • Retirement planning assistance
  • Financial counselling and coaching services
  • Financial education classes and seminars
  • Online financial management tools
  • Cash flow management and budgeting platforms
  • Savings products and services
  • Loan products
  • Short term loans and accrued wage advances
  • Home ownership
  • Purchase or refinance a car
  • Women and financial wellness
  • Retirement planning
  • Peer-to-peer sections
  • Theft identification
  • Protection from frauds and scams
  • Elder care
  • Healthcare costs
  • Economy/stock market
  • Loss of Income/job

Growth Constraints

Many employers recognize the importance of financial wellness but not all the programs address the actual need for the employees, so participation rate of employees become less. Less than 30 percent offer information and education around day-to-day finances, budgeting and debt management.

Growth Drivers

The key drivers for employers to increase financial wellness services for the employees are mainly due to the increase of financial stress which would affect the company’s growth and retention strategy and also success planning. So employers are coming up with programs that can counselling and support services to manage their financials.

To increase productivity by reducing the financial stress:

  • There is a direct link between financial stress and poor physical and mental health. High financial stress in employees can lead to less productivity, absenteeism ,and presenteeism which can hamper growth

Improve financial health of employees and brand image of the company:

  • Health education, health screening, and disease management have helped in reducing absenteeism and increase productivity and efficiency. Brand image includes talent attraction, retention, and ideas of broader corporate social responsibility
  • Financial wellness would improve employee engagement and organizational commitment

Government regulations:

  • The Financial Consumer Agency of Canada provide educational materials, tools and support to help students and adults increase their financial knowledge and skills
  • The Consumer Financial Protection Bureau and Center for Financial Services Innovation: They are doing a research on how innovative companies are leveraging technology, peer-to-peer relationships, and other promising practices to find low-cost, high-impact ways to promote financial wellness at work and supporting employers 

Growth Constraints

Many employers recognize the importance of financial wellness but not all the programs address the actual need for the employees, so participation rate of employees become less. Less than 30 percent offer information and education around day-to-day finances, budgeting and debt management.

Lack of clarity:

  • Employees do not have clarity on the exact definition and potential benefits. This lack of awareness may be constraining the growth of financial wellness as a core benefit offering

Limited program scope:

  • Many organizations aren’t providing support for the financial struggles that many employees face daily rather than they are only focusing on retirement education but employees require support on financial planning

Lack of personalization and targeting:

  • Financial wellness initiatives are not tailored to different employee groups. Generally, the programs should differ by age, gender, income and marital status etc.

 ROI and changing business needs:

  • Employers are concentrating on the ROI for future enhancement of the program. However, the correct realization has been difficult to calculate and analyze. There is a difficulty found in the administration technology platform to react quickly to meet the changing business/employee needs

Privacy concerns:

  • 61 percent of the large employers say that sharing employees’ data is a barrier to participation in financial wellness programs
  • Employees cite concerns regarding privacy concerns about the data and information pertaining to them

Cost and time:

  • 49 percent of HR professionals indicated that cost is the main road block in introducing a financial wellness program as per SHRM