Bosses want their employees to be smarter about money — and not even the company’s money.
Because U.S. workers suffer so much personal debt, it’s affecting their jobs, says a joint study from Fidelity and nonprofit organization National Business Group on Health (NBGH).
To improve their personal debt, companies offering financial incentives as a well-being program are increasing in popularity. Eighty-six percent now offer them, compared to 74 percent last year. And the amount they’re willing to give employees has steadily been on the rise, too. What is now $784, was $742 last year, and only $521 five years ago.
Sixty-seven percent plan to add to their company’s well-being programs over the next three to five years. And 29 percent plan for them to be financial incentives for workers who show better financial behavior.
“The fact that companies continue to dedicate an increasing amount of resources to their corporate well-being programs indicates they are having a positive impact on overall workforce performance,” says Fidelity VP Robert Kennedy. “An employer’s well-being programs are now overwhelmingly viewed as a platform to improve employee engagement, increase worker productivity, and reduce absenteeism.”
Why do companies care?
Workplace stress costs the U.S. economy $300 billion every year, according to The American Institute of Stress (TAIS). Americans’ top stress is financial, says a study from employer benefits company Umum. And absenteeism alone costs U.S. companies $601 per workers every year, which adds up to $3.5 million to companies annually.
To boost morale and productivity, more companies are adding to their well-being benefits. What has been more focused on physical health is now touching on financial health, too. Anti-smoking and healthy eating campaigns were more frequently seen in companies previously. Now 90 percent plan to add budgeting and debt management programs.
“More employers are viewing holistic well-being as an integral part of their overall workforce strategy,” says NBGH CEO Brian Marcotte. “The goal is to create a competitive advantage by deploying the healthiest, most productive, engaged and competitive workforce possible to boost business performance and empower great people and communities.”
Don’t Americans know how to manage money already, though?
A needed benefit
Not exactly. Just last year Debt.com reported work was the best place to learn about money. Because most Americans aren’t learning about money anywhere else. Financial literacy in the U.S. isn’t in a great place. Only 17 states require public school students to pass a financial literacy course to graduate, according to credit bureau Equifax.
Only 37 percent of parents think they do a good job teaching their kids, says a 2016 study from RBC Wealth Management. Probably because no one ever taught them. Thirty-five percent say neither their parents or schools taught them about money management. Another 39 percent say they learned on their own. Which is why 87 percent of Americans want financial literacy to be taught in schools, according to the study. Fifteen percent say as early as elementary school, while 72 percent say middle and high school.
“Having a basic understanding of how money, investing and our broader financial system works is critical in our society today,” says Tom Sagissor, president of RBC Wealth Management. “Yet there is a growing realization, particularly in the wake of the last financial crisis, that many people don’t understand budgeting, investing or how simple financial products like loans work. That puts them at a disadvantage not only during their working years, but as they begin to contemplate retirement.”
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