As employee disengagement continues to rise, it’s more important than ever to take every possible step to address it. According to Jean Chatzky, this takes evaluating and building a strategy to boost your employees’ “total well-being” — their emotional, physical, social, community, spiritual, work and financial wellness.
While an employer can’t address every element of total well-being, you can tackle one of the biggest issues that derail an employee’s focus: financial stress. How? By empowering your workforce to become financially literate through a targeted strategy that shows them how to make confident and informed decisions.
How can financial literacy help your employees?
Financial literacy gives employees the means to better plan their lives. According to Fidelity Investments, employees who score higher on financial wellness assessments save a greater percentage of their income for retirement. By extension, employees who can effectively budget may stress less about their overall financial situation. In turn, this can translate to higher focus and employee satisfaction.
But financial wellness — and by extension literacy — can’t be raised without education. When employees understand their pay and how to wield it, employers lay the foundation to improve their workforce’s overall financial health.
It’s worth noting, however, that not every financial wellness strategy will work for all organizations. Blake Allison, CEO and Founder of LifeCents, discourages overarching approaches that fail to consider a specific outcome.
“One-size-fits-all is a bad thing,” Allison said. “There’s a risk that employers are trying to kill a mosquito with a sledgehammer.”
Instead, employers need to identify a specific goal and consider actionable ways to address it.
What are the advantages of financial literacy in the workforce?
The benefits of financial literacy may not be identical for every employee, but in general, employers can expect to see:
- greater focus and engagement
- higher responsiveness and productivity
- lower absenteeism
- improved workforce satisfaction
- less time-consuming questions for HR
And while a strategy to support financial literacy is great, organizations should also consider automated self-service software that allows employees to easily access their data anytime, anywhere.