According to The American Psychological Association’s 2009 Stress in America report, 75 percent of Americans report experiencing moderate to high levels of stress when it comes to money. In fact, financial problems ranked as the No. 1 cause of stress in the poll, followed by work and the economy, and, last year, 42 percent of Americans reported an increase in stress.
And family money issues far outranked housing costs, health issues and job stability as sources of stress. But those issues don’t stay at home, says Sally Stephens, president of Spectrum Health Systems. These people struggling with financial issues are your employees, and they’re bringing that stress to work with them.
“Financial worries have been shown to affect employees’ performance at work,” she says. “Financial stress can impact absenteeism, productivity, retirement and, of course, health care costs.”
Smart Business spoke with Stephens about why employees’ financial issues should matter to you and what you can do to help.
Why should employers care about their employees’ financial health?
The 2009 Stress in America report clearly demonstrates the need for employee financial health care. Stressed workers are unhealthy and can cause a financial drain on their employer.
Adults with high levels of stress, above eight on a scale of 10, are less likely to eat healthy, exercise, lose weight, take steps to reduce their levels of stress and get enough sleep. High levels of stress can also lead to anxiety and depression.
How can an employee’s good financial health benefit both the employer and the employee?
Simply put, it can reduce health care costs, improve productivity and presenteeism, reduce absenteeism and create a better sense of well being among the work force.
Not only has the economic environment created challenges today, it has also shed light on the need for all of us to reduce our debt, increase savings and have a sound strategy for retirement, regardless of age. However, employees’ money management issues extend far beyond retirement, as many workers are struggling just to stay above water, let alone put money aside for the future. In addition, bankruptcies have risen steadily since 1985. All of these things are problems both for the employee and the employer, and they have serious social implications.
According to a recent Associated Press poll, half of Americans worry about debt, and 20 percent report worrying about it all the time. This creates so much stress that it affects their work. Such distractions can be a significant drain on productivity.
What are some ways employers can support healthy financial habits in their work force?
According to the Society for Human Resource Management, 29 percent of employers already offer general financial education to their employees.
The first thing an employer can do is to determine if financial concerns are becoming a distraction for employees and increasing their stress at work. How effective are your benefits, education and assistance programs in addressing and preventing employee financial issues? As with health and wellness, employee personal financial fitness is an important part of overall well being.
While providing general financial information and education can be helpful, it is often not enough, and real impact is often not measurable.
How can employers educate their work force about financial wellness?
Employers can support the financial habits of their work force through a variety of ways, including:
- Conducting a survey that can help the organization personalize statistics. One such tool is the Personal Financial Wellness Scale developed by the Personal Finance Employee Education Foundation (PFEEF).
- Holding seminars to educate employees on the basics of financial responsibility. Try using a fee-only provider who is in the business of educating, as opposed to selling benefits.
- Consider introducing a financial wellness program. These programs aim to break down the barriers to improved financial health by providing resources to solve financial issues. These can include web-based tools, live seminars and one-on-one counseling.
Other than education, what are some other resources employers can use to support their employees’ financial health?
Incorporate financial literacy or financial education programs as part of the corporate training calendar. Many employers provide personal development education and training not directly related to their business because it sends a message that they value their employees. There are online training programs that employees can access on their own time, and you can provide books and other materials on personal finance. Seminars and workshops both on and off company time are also valuable resources.
In recent years, more employers have come to accept that attending to the well-being of their employees makes good business sense. Physically and emotionally healthy employees are far more productive than those who are struggling with either their physical or emotional health.
When employers prepare their work forces for retirement, they are not only bettering society but their business, as well.
Sally Stephens is president of Spectrum Health Systems. Reach her at (317) 573-7600 or firstname.lastname@example.org.