Financial Stability: 3 Ways to Support Your Employees
Financial Stability vs. Stress
As the United States continues to navigate the COVID-19 pandemic, more and more data shows that employees face financial stress. A recent John Hancock survey revealed that 67 percent reported financial stress in 2020, up from 44 percent before the pandemic. Since this stress impacts workers personally and how they do their jobs, it’s becoming more critical than ever for employers to step in and help workers build financial stability. Developing effective employee financial wellness programs is especially important in uncertain times.
Here are three ways companies can help their employees manage their finances.
1 – Earned Wage Access
Companies across the country are asking their staff what’s important to them. They learn that people need access to cash much more quickly than during the traditional pay cycle.
Enter earned wage access (EWA). EWA is a benefit that lets workers receive at least part of their paycheck before traditional payday. Employees request money they’ve already made and receive payment. It’s a valuable tool to help workers build financial stability.
EWA, or on-demand pay, helps employees manage their short-term finances and can help with emergency costs like car problems, doctor bills, or any other unplanned expenses. Those who use EWA pay a small fee. This benefit is more helpful than credit cards, loans, or writing checks with little or no funds in their account.
2 – The “Right” Financial Stability Experts
Since not all personnel earn the same wage, uniform financial advice is irrelevant to all your employees. It helps to bring in experts who can speak to the specific challenges they face in building financial stability.
For example, some may be living paycheck to paycheck and having problems paying down debt. Others could be struggling to save for a first house. While some advice like saving for emergencies works for everyone, getting there will be a challenge for some. Providing relevant guidance to everyone will be appreciated. Offering advice and resources to staff in all life stages will help develop a well-rounded financial wellness program.
3 – Educate on Credit
Not all credit is bad, of course. But often, employees might not understand how the credit system works. Whether it’s a car loan, home loan, or some other type of loan, your staff needs to know all their options for the situations they might need it. By setting up an expert to walk them through the process, you’ll be helping them to improve their stability and become a better employee.
Undoubtedly, the stresses that started in 2020 are still impacting workers across the country. Now is an excellent time to think of ways to help them cope. EWA is a benefit that can help many of them with their short-term financial issues. Then, helping them understand their challenges and what they can do about them will pay off for everyone in the long run.