Promoting financial literacy in your workplace

With 73% of Americans ranking personal finances as their top stressor, workers are increasingly worried about their financial health. And after two years of economic turmoil, it's not hard to see why. Consumer debt is rising, inflation is soaring, and student debt has been burdening too many for too long.

According to PwC's employee financial wellness survey, nearly two-thirds of full-time employees said their financial stress has increased since the start of the pandemic. Among those whose stress had increased are more four times more likely to experience a decrease in overall household income, and to struggle with monthly expenses, like paying the rent on time. Moreover Bankrate's Financial Security Index found that fewer than 4 in 10 US adults have enough savings to cover a four-figure emergency room visit or car repair. Many live paycheck to paycheck, dipping into 401(k)s to get by.

The struggle to make ends meet endangers employees' mental health and contributes to rising absenteeism and attrition. But there's a lot that employers can do to ease the strain. More and more US companies are providing financial literacy and wellbeing programs. From being able to afford to pay out for life's big events like a kid's wedding or college fees to everyday home budgeting, helping workers manage their personal finances comes with big paybacks for both employers and employees.

So, what should a financial literacy program include?

That depends. Although financial literacy programs may seem like a mammoth undertaking, particularly for small businesses with meager resources, they can be easier and cheaper than you might think:

Make sure your workers are aware of all the benefits you provide

Health insurance. Paid vacation. Childcare stipends. Hardship loans. Employer benefits packages can make a material difference to your workers' financial security. But often, employees aren't sure how to access them. Ensure your employees know how to take full advantage of all the benefits you provide by including information sessions as part of your onboarding programs – and at regular intervals after that.

Offer access to an online financial wellbeing course

License an online course to teach financial literacy topics to employees and help them make effective, informed financial decisions. For best results, offer an enrollment or completion bonus to boost attendance.

Hold financial literacy information sessions

Employees will benefit from sessions on debt management, understanding taxes, retirement planning, and everyday money management. Ideally, use a third-party provider. (Employees will be less hesitant to open up about their financial woes with someone external.) Make sure your chosen provider is independent and unbiased. Avoid engaging someone who's out to sell specific financial products!

Look after your lowest-paid employees

Low-paid employees struggle most with their finances, and groups like veterans, and justice-involved workers are especially vulnerable. Create clear paths to better-paid opportunities and provide the training they need to reach their potential. Also, ‘on-demand pay’ enables workers to access a part of their wages before their official payday – and to automatically direct money to rent and savings. This can empower low-income workers to get back in control of their finances and prevent them from resorting to unscrupulous lenders when unexpected expenses crop up, mid-month.

Understand your workforce

Financial hardship is a multi-generational problem. But the different segments of your workforce will have different financial needs. For example, only 34 percent of Baby Boomers think that they will be able to retire without debt, prompting many to delay retirement or eschew it altogether. On the other hand, Millennials are the most stressed overall about finances. They are more often worried about mortgage and credit card debt and maximizing college funds for their children. For young ‘Gen Z’ workers, help with paying off student loans is often the greatest priority. (Note that workers with student debt stay at their jobs 36 percent longer if employers help pay off student loans.) So, it's essential to tailor your financial literacy efforts to meet your workers where they are.

Promoting employee financial literacy increases all-round wellbeing and productivity. At Adecco, we are committed to elevating associates through job opportunities, expansive health and retirement benefits, and upskilling/reskilling training. These tools and programs improve retention – and improve lives.

Want to learn more about improving employee wellbeing in your organization? Check out our employer resource pages, and explore our staffing tools and solutions. You can also visit mymoney.gov to learn more about promoting financial literacy.