Financial stress can expand far beyond people’s wallets and
into their workplace. According to the latest study by the International
Foundation of Employee Benefit Plans, 96% of employers indicated that
employees’ personal finance issues are impacting their job performance in some
However, the same study found that employee financial
education programs can have a major impact on bringing workers closer to
financial wellness. According to the survey, 66% of employers with a financial
education program in place say their employees were more financially savvy, and
71% said their employees were more prepared for retirement than when a program
wasn’t offered. Of those not offering such a program, only 38% of employers
considered their workforce financially savvy, and 57% of them said their
employees at normal retirement age were prepared for retirement.
Still, no two employee populations are the same and
different components of financial education programs can have varying degrees
of success depending on employee demographics. Nonetheless, the study concluded
that the most successful programs are time-tested, customizable initiatives
backed by leadership and held down with patience.
The firm found that employers reporting successful financial
education programs conducted surveys to gauge their employees’ financial
wellbeing and to identify the topics that needed to be covered such as
investing, budgeting and saving. None of the employers with unsuccessful
programs did this. Moreover, companies also saw some success by customizing
these programs for different groups based on age or income level.
The most successful programs involved multiple components
such as free personal consultation services, classes and workshops, web-based
online resources, workbooks and calculators.
Time was also a huge factor with programs running for at
least 10 years being more successful than those that have only been carried out
for one to two years. One reason may be that time can provide employers with
opportunities to analyze the success of these programs and adapt it as they see
"'Good things come with time' holds true for many
things, including financial education programs,” explains Julie Stich, CEBS,
associate vice president of Content at the International Foundation. "A
program is likely to be more successful the longer it is in place and,
according to the report, it takes more than five years to be reported as
About 49% of programs running for at least 10 years were
deemed successful, as opposed to programs running one-to-two years (5%) or
those running less than one year (3.9%).
"Financial education programs lead to fewer employees
reporting financial distress, calling in sick, being distracted and snapping at
colleagues and customers,” says Stich. “And that, ultimately, means a more
productive work environment.”
More information about the report “A Closer Look: What's
Working in Workplace Financial Education?” can be found at ifebp.org.