It’s no secret: when your employees thrive, so does your business.
It’s no secret: when your employees thrive, so does your business. Evidence connecting workforce wellbeing to organizational fitness is ever-unfolding, and there are myriad ways in which companies can work to support a happy and healthy employee base and in doing so gain critical benefits like better retention, productivity, and more.
Providing your workers with competitive wages and a comprehensive benefits package is vital. Talent today expects more than just pay for services rendered: access to quality healthcare, PTO, and educational advantages can put you over the top as a desirable employer.
But one often overlooked benefit helps employees to help themselves, and create a better future for themselves as well as your company. Let’s talk about employee financial literacy.
At its most basic, financial literacy describes the ability to leverage monetary skills and understanding which enable an individual to make informed money management choices.
The key factors which together construct sound financial literacy include:
Like most skills, financial literacy is something which can be learned. Getting the hang of these elements as early as possible will enable individuals to build a better relationship with their money and create long-term financial stability.
The potential impact of financial literacy on an individual’s wellbeing and fiscal future makes it seem like something which should be compulsory learning in the average high school.
But in the U.S., just 17 states require the inclusion of a personal finances curriculum – and 80% of instructors feel ill-equipped to teach it.
And this lack of educational access shows in current financial literacy rates – 66% of Americans are classed by FINRA as financially illiterate.
But the desire for better financial understanding is there. 60% of individuals surveyed by Schwab are prioritizing financial literacy as a key aspect of their ongoing education.
Also the most represented generation in the current workforce, 75% of Millennials have reported seeking out courses and seminars which will improve their financial literacy.
One statistic demonstrates that 60% of American workers live a hand-to-mouth lifestyle due to a lack of financial stability and upward mobility. A healthy work-life balance – which we know to have an important positive impact on organizational performance – becomes increasingly difficult to achieve when you spend most of your waking life worried about money. Let’s talk about the potential impact.
Financial instability is one of the most pressing and urgent concerns among the current workforce. Especially in the uncertainty sparked by the ongoing pandemic and other tumultuous global landscapes, planning for the future from a monetary perspective has become incredibly complicated.
But what financial literacy does, ideally, is give the individual the tools they need to create a financially stable future for themself. And financial literacy is not a stagnant concept: economic shift necessitates a flexible and active approach to most aspects of money management. So when you have these tools in your kit, you are able to engage with your finances safely and wisely whatever the future throws at you.
A lack of financial literacy takes a toll at the personal level, as well as the organizational. Money worries, especially following the pandemic, are the greatest source of stress among American workers, which may otherwise be mitigated by an increased understanding of how to foster personal financial wellness.
Financial stress can lead to more serious detriments to mental and physical health. When your employees are suffering, your organization can also suffer due to lost productivity and performance, and higher rates of absenteeism and increased healthcare costs.
But companies can fight this phenomenon by giving their employees access to resources which will help build financial literacy.
Skills associated with financial literacy can be just as impactful in business scenarios as they are in the world of personal finance.
Financially literate organizational leadership are better able to make informed business decisions on the part of their direct-reports as well as the company as a whole. The benefits pervade most areas of the company, beyond the purely financial: for example, financial literacy will come into play when making decisions based on ROI analysis across most company programs.
Organizational culture is also driven from the top-down, and if you want to support your workforce in becoming more financially literate, it’s important that management be equipped with the right skills to guide them there. Financial literacy among managers empowers them to foster better productivity and performance among employees by supporting workforce financial literacy.
Still not convinced? Here are a few benefits your organization stands to gain by working to improve employee financial literacy.
Here are a few first steps you can take to help build financial literacy for your employee base.
Origin makes building financial wellness and literacy among your employee base easy with a purpose-built and easily accessible platform that is so much more than a platform.
Origin fosters holistic financial literacy by taking into account all impactful aspects of a well-rounded financial condition, including total compensation, financial planning, equity management, and benefits. It’s comprehensive, personalized to each individual’s financial experience, and provides an engaging experience that takes the stress out of financial education.
Sign up for a free demo today to see how Origin can help your employee base.