Would Your Employees Pass a Financial Literacy Test? (Probably Not.)
A Fortune survey of over 27,000 Americans revealed that ⅔ of Americans could not pass a basic financial literacy exam. That’s a scary thought, but why is that the case?
For many Americans, financial training was never a part of their formal education prior to entering the workforce. When they did enter the workforce, they were forced to balance student loan debt, living expenses, long-term financial planning, and maintain their financial stability for the first time with only minimal knowledge or guidance. These financial demands have led to rampant chronic economic anxiety within households across the nation.
Raising financial literacy within the workplace will help reduce financial stress, boost your employees’ self-confidence, and increase everyone’s ability to contribute and thrive as members of society. Financial education resources are valuable for all employees, regardless of socioeconomic background, income level, or current financial state. All employees are on their own personal financial journey; offering the right resources to meet them where they are and continuing to increase their financial health is key.
Here are some steps you can take to raise the financial literacy within your organization:
Step #1: Understand your employees’ financial situations
Are they focused on buying a home, getting out of the paycheck to paycheck lifestyle, paying down debt, saving for retirement? Knowing your employees’ personal goals and financial challenges will inform the best approach to alleviating stress and elevating their financial literacy and overall well-being.
Step #2: Define financial wellness and success for your organization
Setting goals and clearly defining what you’re hoping to achieve for your organization will be the key to implementing your strategy and moving the needle within your organization. You can evaluate this by asking the following questions:
- Does success mean increased engagement with your financial wellness benefits program?
- Does success include anecdotal evidence from the HR team or financial wellness program provider reports of employees’ improvement and successes?
- Is it increased productivity, impacting your bottom line?
- Is it an overall feeling of improved morale and camaraderie within the company?
Step #3: Identify current gaps and define how a financial wellness initiative will close them.
These are likely questions you will not know the answer to unless you ask your employees, but making it a collaborative effort is one of the most important parts of evaluating and improving your employees’ financial lives.
- What is keeping your employees from improving their current financial situation? Is it understanding how to manage debt? Knowledge and information about mortgage/auto loans, rates, and options? Access to money management resources?
- As an organization, do you have the tools and resources available to support employees and help them tackle their financial challenges and goals? How can you leverage or implement a financial wellness program to help you fill these gaps?
Step #4: Work with a professional to implement a financial wellness plan.
With so many single-point solutions available, you will want to work with a professional who has experience with comprehensive financial wellness programs and is aware of the best-in-class tools to support your team.
At FinFit, we offer access to certified financial coaches, premier financial education resources, personal financial assessments to help your employees identify their goals and create their unique action plan. We couple that with financial solutions and a supportive system to help them achieve financial stability.
Step #5: Find ways to encourage financially healthy behavior.
This helps foster open conversations around money and reduces the taboo often associated with discussing personal finances. These conversations will help your employees feel less alone, and it will motivate them to find solutions to improve their personal financial situations.
You can do this by encouraging individuals to have weekly money dates, monthly financial talks, and annual personal financial reviews. Encourage them to utilize online tools to create and manage their budget, track their spending habits and organize their bills. These practices help individuals become more aware of their financial behaviors and determine their areas for personal improvement.
At FinFit, we motivate and incentivize employees who consistently engage with the program and show improvement. Take advantage of member rewards programs that encourage participation and support financial healthy behavior.