Financial wellness is becoming increasingly important to plan sponsors. Financial problems decrease employees’ productivity, increase their absenteeism, and even affect their health. According to a report issued by the Consumer Financial Protection Bureau in August 2014, 7 out of 10 American workers say that financial stress is their greatest cause of stress. It’s clear that employee financial stress affects a business’ bottom line. The Participant EffectSM explains:
Employers Take Action
Recognizing that employees need help with financial wellness, more and more companies are establishing financial wellness programs. A survey conducted by Aon Hewitt noted that 75% of large companies planned to focus more on employee financial wellness in 2014. So what is financial wellness, and how can plan sponsors help employees achieve it?
A simple definition of financial wellness is when employees face minimal financial stress, they have an adequate financial foundation (including savings and minimal debt), and they have a plan to meet their future financial goals. To find out how many of their employees are financially well, employers are turning to financial wellness programs. Typically, these programs are:
Offered by unbiased third-party education companies that work to change employees’ financial attitudes and behaviors.
Comprehensive, covering every aspect of financial planning, from day-to-day debt management to retirement planning.
Personalized, offering individual employees a specific plan and set of actions they should take to reach financial wellness.
An ongoing process, one that encourages employees to regularly review their status and provides ongoing support.
The Participant EffectSM
The Participant EffectSM provides employers with a holistic set of tools to help them assess their financial wellness, and take steps to become financially healthy. The process begins with an extensive financial wellness assessment, which analyzes each employee’s financial situation, and helps The Participant EffectTM design an educational program that offers your participant base the knowledge they need to make sound financial decisions. Education is available through both in-person and web-based sessions, and goals are established and progress is tracked to make sure your employees are getting the information they need. Find out more about the program by browsing our website, or by calling (888) 968-9168.
This information was developed as a general guide to educate plan sponsors, but is not intended as authoritative guidance or tax or legal advice. Each plan has unique requirements, and you should consult your attorney or tax advisor for guidance on your specific situation. In no way does advisor assure that, by using the information provided, plan sponsor will be in compliance with ERISA regulations.
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