Over the past few years, financial institutions have significantly increased their investment in initiatives to grow consumer and small business financial literacy. An even more recent development has been the emergence of workplace-based financial wellness programs: a 2018 survey by Strategic Benefit Services found that 59% of employers offer financial wellness programs or planned to do so. And recent research by Alright Solutions found that 64% of employers say their organization’s financial wellness program is more important now than it was two years ago.
This rise of workplace financial wellness programs has been driven by several factors, including:
- The overall growth of investment in financial education programs by the financial services sector in response to concerns about gaps in financial literacy levels, and the proven positive impact that financial education programs have in driving smarter financial behavior by consumers and small businesses.
- Employer desire for additional benefits and services to attract and retain staff.
- Employee need for financial education: PwC’s 2018 Employee Financial Wellness Survey found that 41% of employees say their employer’s financial wellness plan has helped them get their spending under control.
- Recognition of the value and critical role the workplace channel can play in teaching financial concepts, as well as in providing advice and potential solutions.
Financial firms providing workplace financial wellness programs include banks, investment firms, and employee benefits providers. Many of the leading firms in these sectors have launched new or enhanced existing financial wellness programs over the past year:
- Principal launched Principal Milestones, which provides personalized information based on an online assessment.
- MassMutual introduced MapMyFinances, a financial and benefits planning tool that features a financial wellness score.
- Morgan Stanley Wealth Management launched an enhanced Financial Wellness Program for employees of mid-to-large sized corporations, which features a digital portal, a catalog of financial wellness materials, financial assessment as well as the option to collaborate with a Financial Advisor or through Morgan Stanley’s online investing program.
- Prudential introduced a range of new financial wellness capabilities, including expanded digital and on-demand solutions, as well as needs-based and life-event solutions.
Unfortunately, financial wellness programs do not tend to be immediately embraced by employees. This can be attributed to a number of factors, including a lack of interest among employees, perceived complexity of the programs, and the lack of resources to manage the program. To overcome these challenges, employers must clearly communicate to employees how they will benefit from engaging with the financial wellness program. To that end, financial institutions need to support employers in marketing the program to employees. It’s also important to gather feedback from employers in order to enhance features and improve the user experience.
The growth in workplace financial wellness programs shows no sign of abating, and we expect financial institutions to further improve and differentiate their programs through new features and options (such as enhancing access to the program via digital channels), as well as continue to develop financial wellness-related content.Subscribe