FINANCIAL WELLNESS MAY START WITH STUPID QUESTIONS

employee questions about financial wellness

A version of this article recently appeared on Forbes.com

Financial wellness is having its moment. Employees are feeling stressed by financial challenges, and that stress is impacting their ability to be engaged at work — as well as their overall well-being. According to PwC’s 2022 employee financial wellness survey, inflation is a top concern for 20% of respondents. In addition to negatively impacting their productivity and attendance at work, money concerns are also chipping away at employees’ sleep, self-esteem, and relationships at home.

What’s more, they’re reluctant to ask for help with financial issues. In PwC’s study, 41% of financially stressed employees said they were embarrassed to admit they faced financial challenges.

Build awareness of existing programs

You probably already offer several benefits that support financial wellness, from EAP counseling to financial literacy offerings by your ERP platform or 401K provider. Or you may have an employee wellness platform that includes financial modules. But employees may not have high awareness of those offerings — and may not be familiar with some of the basics that those programs assume they understand.

By building relevant financial topics into your internal communications, you can help build employee awareness of those benefits and guide them to confidential ways to get help with financial stress.

Here are five financial questions employees may be embarrassed to ask:

1. “I have a budget, but what am I supposed to do when I go over?”

Setting up a monthly budget is just the first step. Employees may not understand how to track their actual spending against that budget — and what actions they might want to take when their monthly expenses exceed their budget, from reducing spending for the month to come to transferring some money from savings.

2. “Which is better — low premium/high deductible or vice versa?”

If employees have a choice of healthcare plans, they may be confused about the trade-offs between saving on premiums or having a lower deductible. Take the opportunity during open enrollment to explain the difference, and maybe give examples of how different plans might impact employees with high medical expenses compared to ones with minimal medical needs.

3. “What’s so great about 401K contributions being pre-tax?”

Young employees who haven’t participated in a retirement plan before might not understand that pre-tax payroll contributions don’t impact their net pay as much as they might expect. Show examples of sample paychecks and contribution amounts in your retirement plan communications, and while you’re at it, make sure they understand the power of compounding interest.

4. “Why would I pay more than the monthly minimum on debts?”

It may be obvious that the more employees pay on their credit cards and loans, the faster they’ll be rid of those debts. But many employees may not realize how slowly their debts will be reduced if they only make the minimum payments. Educate them on ways they can reduce some less meaningful spending so they can apply more money to debt reduction — and provide a calculator tool to show them the long-term impact of having more of their payments applied to the principal.

5. “How much home could I buy on my current salary?”

Employees who’ve never owned a home or gone through the homebuying process may not understand the difference in a fixed rate or adjustable mortgage, why a lower down payment will require PMI, or even how much of their paycheck they could comfortably spend on mortgage payments. Help would-be first-time homeowners with lunch-and learns or video conferences, possibly hosted by local realtors or mortgage bankers. This is also a topic that some Employee Resource Groups might want to take on, if you have a young professionals group or a diversity group with members who might have experienced unconscious bias in the loan approval process.

Personal finances impact work performance

Although some of these financial wellness topics may fall outside the usual territory of internal communications, we know that employees bring financial stress to work with them. According to Gallup’s 2022 State of the Global Workplace report, only 22% of respondents report living comfortably on their current household income and 44% experience daily stress during a lot of the day. Gallup also found that 22% of adults suffer from extreme financial stress — and that can make it difficult for them to focus at work.

The past few years have redefined employee wellness to include elements far beyond physical fitness and biometrics. Employees want to know their employers care about their entire well-being — including mental health. Be sure your employees are aware of the financial wellness benefits available to them and use internal communications to fill in some of the answers to questions they may be reluctant to ask. (For help writing about financial basics without talking down to employees, try this Best Practices one pager.)

Interested in doing more to promote financial wellness for your employees? Tribe can help.

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