4 Ways to Improve Employee Financial Wellness
The word “wellness” is a tricky term. Its definition is slightly subjective, but let’s try to dissect it a bit. Merriam-Webster defines it as “the quality or state of being in good health especially as an actively sought goal.” So you could safely assume that wellness means whatever word it is attached to is in good standing. But when it comes to finances, what is “good standing?”
For your employees, financial wellness is more than just their pay rate. It’s the amount of stress finances have on their lives, as well as the impact finances have on their ability to do their job. If you could get their finances in good standing, why wouldn’t you?
From payroll cards to bonuses, here are four ways to improve employee financial wellness that benefit both the employee and employer.
- Offer Bonuses or Incentives
Whether you offer them based on performance or not—there’s a healthy debate on the subject—the fact remains that bonuses put more money in each employee’s pocket. If your company doesn’t have a bonus program, you could even base it on company performance. So if employees as a whole meet whatever goal you set forth for them, they all benefit and it’s not up to one individual employee. Even if the bonus isn’t lifestyle-changing, a small incentive to look forward to at the end of the year can potentially reduce financial stress.
- Provide Early Pay Access
Another way to improve employee financial wellness is to offer early access to wages. With the Spentra payroll card, for example, employees can access up to 50 percent of net wages earned at the time of request (at no cost to the employer). By limiting the amount the employee can withdraw, it helps them stay financially stable, yet gives them access to funds earlier so they can avoid stressful situations like late bill fees and past-due rent.
- Educate Them About Smart Money Management
According to Forbes, just 57% of Americans are financially literate. If you were to apply that number to your company, it means nearly one in every two employees doesn’t even know what financial wellness looks like—much less how to get there. Consider hosting regular workshops or training sessions that show employees how to set a monthly budget, how to save money on everyday expenses and other smart money management tips.
- Offer a 401(k) Plan
A retirement account can help an employee’s long-term financial wellness, whether you match their contributions or not. (Though matching admittedly provides extra incentive.) By encouraging employees to take part in a company 401(k) plan, you can help them save for the future with minimal impact on their paycheck.
If you’re interested in using a payroll card to help improve employee financial wellness at your company, contact the Spentra team today.