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Making a commitment to improve employee financial wellness

by Janice Holman, Defined Contribution and Financial Wellness Practice Lead, Eckler

If you told the CEO of a factory that there was a toxic spill on a warehouse floor and it was making employees less productive or physically sick, they would undoubtedly do everything they could to clean up that spill as soon as possible.

If you told that same CEO that financial stress was making employees less productive or physically sick, there is less certainty that the call to action would be as quick. However, research tells us that financial stress is having a significant impact on Canadian employees — and their employers. According to the Financial Consumer Agency of Canada, employees suffering from financial stress are twice as likely to report poor health, and almost half of working Canadians admit that stress related to personal finances has had an impact on their performance at work.
 
Lack of focus at work, increasing amounts of time spent managing personal finances and increased use of employee benefit plans to manage stress-related illnesses are now commonplace. In fact, according to Eckler’s 2019 Survey on Financial Wellness in the Workplace, more than half of employees feel some degree of stress about their finances, and close to one-third would describe it as a high degree of stress. It’s not surprising then that 80% of employees say they would like financial wellness education.

A trusted source of information   
For employers, the competition for talent and the ability to retain key employees is fierce. Employees are highly mobile and unemployment rates remain at historic lows. Financial education can play a significant role in attracting, engaging and retaining top talent. The good news is that according to the Eckler survey, more than half of employers say they offer some form of financial education, and one-quarter say they plan to offer it in the next two years.
 
Employees and employers alike told us that who delivers the education is also highly important to them. If the source of education is not trusted, motivation for employees to act based on the information provided will be low. A financial educator who is unbiased, accredited and experienced is critical to engaging employees in the education provided. 

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Steps to a successful financial education program
A well-designed financial wellness program is critical to helping employees achieve their financial goals — and for getting the most out of the employer investment.

Here are five key steps for developing and implementing a successful program:
 
1: Get buy-in from senior executives
One of the biggest barriers to launching a financial wellness program in the workplace is getting buy-in from senior executives. This is a critical first step, so you will need to clearly explain the cost benefits (what are the company’s top concerns; how will a financial wellness program help achieve them?) Every executive should want a financially healthy and engaged workforce, and they all want to increase company revenues. Explain clearly how financial wellness program can achieve each of these goals. 
 
2: Find a third-party provider
Partner with an unbiased, accredited and experienced educator. These attributes not only help to ensure that employees “buy in” to the program but also provide assurance that you are working with someone who has the knowledge to help achieve company objectives.

3: Design the program
Effective employee financial wellness programs must be comprehensive and delivered effectively. While all topics should be discussed, what should be emphasized depends on the needs of your employees. The delivery method is equally important — group seminars, one-on-one coaching, webinars, self-study, etc. Which method to use will depend on what your employees want, what approach suits your workforce and what your budget dictates.

4: Build a comprehensive communication plan
This step is crucial to the success of the program. Companies, along with their third-party educators, need to develop a comprehensive communication plan to ensure employee buy-in, program participation and ultimately, program success. Communication should be delivered by multiple stakeholders (senior leadership, human resources and people managers) and in varying formats: email, company intranet, signage in employee cafeteria, team meetings, etc.
 
5: Measure and assess  
Measurement and assessment are the cornerstones of effective program management. Making informed decisions about program effectiveness is critical to improving the financial wellness of employees, and empowering employers to make strategic decisions that support their employees and enable company goals. Establishing the key criteria for success is essential. Setting key metrics such as monitoring behaviours in retirement and savings plans, benefit elections, absenteeism, use of EAP services and disability claims can show a direct link between education and outcomes.

For many Canadians, understanding and managing multiple financial assets and obligations is a complex and daunting task that can contribute to significant stress, impact work performance, and delay retirement. Providing employees with the information and confidence they need to make critical financial decisions will help them focus on the future, ease daily financial stress, and be more engaged in the workplace – that’s good for employees and their employers.

Holman,-Janice-March-2015.jpg Janice Holman, Defined Contribution and Financial Wellness Practice Lead, Eckler 
Janice leads the defined contribution and financial wellness consulting group at Eckler, and is a Principal of the firm. Her passion for helping companies design effective retirement and savings plans and providing the support members need to reach their financial goals fuels all that she does. Her background of investment management, employee communications and DC consulting provide her with a wholistic view when creating solutions for clients and engaging with members. Janice works with some of the largest Canadian organizations and is committed to the CAP industry. She regularly contributes to industry publications and is a frequent speaker at industry conferences.