As employment opportunities abound and workers aim to find life balance, corporate wellness programs (and those companies that offer them) are gaining appeal for job seekers. Google offers EnergyPods, which encourage employees to stay well rested. IBM annually compensates healthy employees with $300 rewards. American Express offers on-site medical care and examinations. Though many companies aren’t able to offer resources like these, wellness programs are well on their way to becoming an expected employee benefit.
Luckily, the benefits of these programs are not one-sided: Employers greatly benefit too. In fact, studies have shown that effective wellness programs result in lower attrition rates than in companies without them. These programs are designed to not only make for happier and healthier employees, but also increase productivity and the bottom line.
According to Gallup-Healthways, the five essential elements to wellbeing are purpose, social, community, physical and financial. Yet, “in the U.S., 28% of adults aged 18 and older are not thriving in any of the well-being elements, while 7% are thriving in all five. So for every adult who is maximizing his or her well-being potential, there are 13 who have significant room for improvement in one or more elements.” With the average full-time worker clocking almost 50 hours per week, employers have the opportunity to significantly improve their employees’ wellbeing.
Workplaces naturally offer a sense of purpose and community, while many corporate wellness programs focus on physical and social health. The missing element, then, can often be financial health. Feeling in control of their finances and navigating unexpected expenses, workers are given a sense of security that lowers stress, increases health, and leads to higher productivity.
Show Me The Money
Fortunately, there are ways companies can help alleviate monetary strain among their employees without having to dole out frequent raises and bonuses. Here are five often untapped resources that employers can provide to foster financial health among their workers:
- Short-term compensation withholding options
Regardless of income, putting away money can be difficult for anyone. Once money hits a person’s bank account, it’s there to spend. However, employers can aid in employees’ saving efforts by withholding specific amounts from every paycheck per the employee’s request. For instance, if an employee is planning a family vacation in December, she can request that $50 of every paycheck is held back for her vacation fund, which she could choose to access only shortly before her trip.
- Pre-tax flexible spending accounts
When employers offer a Flexible Spending Account (FSA), employees can set aside earnings in order to pay for various expenses, including medical and dependent care. The advantage to employees who use an FSA is that the earnings accrued in the account are not subject to payroll taxes. Previous to the Affordable Care Act, any unused funds would be lost at the end of the year. However, now employees are able to roll over up to $500 from their account into the following year. That means major tax savings for workers.
- Financial planning workshops
Navigating saving for college, buying a house, and planning retirement can be stressful. Financial planning workshops give workers access to resources that help them meet their personal financial goals all while maintaining their current salaries. Try offering optional workshops to your employees every quarter, each with a new topic. To encourage attendance, host these sessions during the lunch hour and cater food in; your employees are much more likely to attend if it doesn’t require staying late or coming in early.
- Flexible payment access
$1 trillion worth of earnings are temporarily held up in the payroll system every year. Giving workers access to that income allows them to manage and improve their finances both by dodging potential bank fees and by allowing them to make strategic investments. Low earners are often hit with late fees and overdraft fees while their money is held in the payroll system. With access to their pay, workers can not only retain more of their earnings but also have the opportunity to invest those earnings and increase their take-home pay. Companies can encourage employers to use free tech tools in order to do this.
- On-site personal financial advisement
For many employees, meeting the asset minimums and paying the high fees associated with personal financial advisement is impossible. However, educating employees on their financial options is an easy way to increase their long-term earnings without increasing salaries. Bringing advisors on-site takes the guesswork out of finding a trusted source for financial advice. Therefore, it is in the best interest of a company to leverage their employee base and work with experts who can help them make educated personal financial decisions.
As June’s Employee Wellbeing Month is behind us, it’s important to note that wellness among workers is something that can and should be promoted year-round, and that the most effective wellness programs will go beyond gym memberships and nutrition workshops by offering resources to improve workers’ financial health as well.
About The Author:
Ram Palaniappan is a financial tech entrepreneur who previously ran RushCard and pioneered direct deposit onto prepaid cards as an alternative to check cashing. Under his leadership, RushCard helped more than a million Americans deemed “unbankable” by the U.S. financial system. He took the company from being an experiment in an emerging industry to a mature business with private equity investment. Ram is onto his next venture – Activehours – which is building an innovative new way for workers to get their pay.