Employees are distracted and restless due to financial worries and most companies don’t know how to solve this problem
Employees are more financially worried and stressed are less productive at work, according to the 2017 Cigna 360-degree well-being score report published by Cigna TTK Health Insurance, and these trends could be red flags for companies and HR managers.
For one, the Family and Finance Health Index dropped from 79.9 in 2015 to 76.2 in 2017. It was found that 70% of employees could take care of their parents’ financial needs but in 2016, this dropped to 54% in 2017. When financial wellness is a goal that seems to be slipping away from employees at large, what exactly are we doing wrong?
The key could be in understanding financial wellness programs and how they can turbocharge organisations. In the US, for instance, HR managers and organisations are baffled by the results of the PWC 2017 Employee Financial Wellness Survey, which states that 53% of workers are stressed about their finances, and the younger they are, the more likely they are to be worried.
The US is doing something about it though. Financial wellness programs and platforms seem to be the answer, offering employees new ways to get control of their life and money.
It is only a matter of time before financial wellness platforms take India by storm. There is one crucial factor that distinguish them from regular health check-ups or short-term financial courses. While they can help employees get back on track in terms of life and money goals, they can also amass data and self-improve to give better behavioural results in the employees who take them.
The Family and Finance Health Index also showed that workplace wellness programs were crucial retention tools, particularly in the 25 to 29-year-old age demographic.
Something very interesting is happening. Life & Money, India’s first holistic digital wellness platform, conducted a Twitter chat to find out what is happening with Indian employers. Sahil Nayar, HR Head at KPMG, facilitated the chat, resulting in some very interesting discoveries about financial wellness in India.
Not just about investments and insurance
What kind of financial wellness do employees need? Financial literacy education, while crucial, is one part of the solution. The other part lies in helping employees makes sense of money and how it can make them happy, instead of letting it control them. It’s a simple but immensely powerful idea.
Says Partha Iyengar, Co-Founder of Life and Money, “Financial wellness should help employees prioritize their goals and develop smart money management techniques to lead a balanced life.” Interestingly, the Family and Finance Health Index showed more people taking care of their health but less people approaching financial wellness much the same way. After all, aren’t both related? Mithun Sanyal, Director – Sales at Life & Money, agrees. “It is important to create awareness among employees about financial health the same way physical health or other wellness programs are offered as employee benefits,” he says.
Nupur, an HR specialist and writer, perfectly sums up what is missing in our approach to financial wellness. “I think wellness starts from awareness. If you are aware, you’ll work on the wellness, which means financial stability and comfort based on lifestyle.”
Do financial wellness programs in India get it right?
Indian companies do introduce financial wellness programs but many of them have gaps. For instance, the search for financial peace and wellbeing can be never-ending, unless dealt with in the right way. Says Neetubala Raina, “Financial wellness enables you to invest your development and happiness, or else you are struggling to save, and it is never enough.”
Satarupa Kaur makes a very important point. “Employees and employers will have different takeaways from a fin wellness program. Tapping into the variations of perspective is vital to organize a successful program.”
According to Mithun, a good financial wellness program should be outcome driven. “How else do you measure the success and see the positive difference it creates, for the mutual benefit of employee and the employer?” Financial wellness is now a whole new revolution in the US, with many programs harnessing Big Data and AI to build programs that are adaptive and induce positive behaviours in employees.
Does financial stress decrease employee productivity and increase attrition rates?
Been there, done that, right? We’ve all gone through times when our struggle with controlling our finances has seeped into our work and affected it. Says Manoj Ganapathi, Technology Advisor at Life and Money, “Any stress decreases employee productivity. Financial stress, doubly so. How many times haven’t we seen employees quit a job they really like, just because of perceived financial instability?”
Can this threat be averted early on? Says Partha, “With anywhere from 60-80% of the workforce being millennials, it is imperative to empower millennials on financial wellness as part of the onboarding process in every corporation. The programs need to have clear metrics to measure the outcome of the programs.”
According to Mithun, four factors are involved. “Companies don’t know where to start when it comes to financial wellness. They also lack leadership support, just like you have leadership in all other initiatives and projects. There is also a lack of internal resources to support the program. Finally, companies are not considering the financial wellness of their employees a priority at all.
Prashant Joglekar has a very interesting take on this. “Employee wellness depends on how well the financial wellness of the organisation is.” This idea, of a company actually leading by example and employees modelling a revolutionary behaviour in financial wellness and behaviour, could be the key to unlocking the potential of a financial wellness program.
Financial wellness can do one other very interesting thing for your company
Future trends in financial wellness programs look very exciting. Gamification, automated tracking and adaptive software — these are some of the ideas at the forefront of financial wellness, already underway in the US. The gamut of changes that this approach brings can power the company in unexpected ways. Says Partha, “Research indicates that increased financial wellness among employees leads to increase in innovation in products and services. Millennials in Indian companies will influence the introduction of digital financial wellness programs.”
It’s simple. Innovation is the key to bringing about a change in financial wellness, and any company that thinks progressively is going to ace this game. After all, Netflix completely changed the way we access cinema and television and turned both those industries on their heads. Maybe a visionary financial wellness program can completely change the way we use and understand money, both in and out of the workplace?
The above blog is by Shweta Sharan