Employee Financial Wellness – The Hottest Buzzword Of 2017
Abhishek and Priya are highly paid corporate executives who live in a rented apartment in Kochi. They are in their mid-30s, and have two school going kids. They love their job and they balance their career with family time, going for a vacation once a year. But now with their kids growing up and expenses increasing, Abhishek found that they are not good with their finances, even though their salaries are high. They have mounting credit card statements, EMIs and don’t have enough savings for their children’s higher education and emergencies. This induced panic in him, thus losing focus on his career as well as family, falling in a vicious trap of financial stress.
What went wrong in Abhishek’s case? It’s not that they were spendthrifts. It’s not like they did not earn well. What they did not have was the knowledge or time to manage their money properly by monitoring cash flows and investing through proper channels.
Many times, executives are so engrossed in performing their duties at office, that they do not apply the same attention to their personal planning. While catering to the demands at home as well as office, financial planning often takes a backseat. Result? Mounting stress and reduced productivity.
A new study shows that about 67% of the executives worry about their financials at workplace, thereby losing their ability to focus and be productive at work. Our generation spends almost four hours a week at work worrying about our personal finances, almost twice the time compared to the older generation. With expenses ever increasing and economies dwindling, it’s high time we considered seeking professional help with our finances.
Why is it necessary to have an employee financial wellness program?
According to Employee Wellness Survey by PwC, more than half of corporate employees across the globe are severely stressed about their finances. Those who are stressed are more likely to be distracted by their finances at work and cite health issues caused by financial stress. More than often, they are physically present in the office, but mentally absent as they constantly worry about the pending EMIs and credit card statements or depressed that they do not live the lifestyle they deserve.
The survey report also found that employees hope their employers can help them manage their finances. We did a similar survey ourselves, and found out similar results. Taking cue, Corporates across the globe are starting steps to address financial stress at workplace. Hence, Employee Financial wellness has become a buzzword and is a highly valued benefits program.
Financial Wellness Program is very similar to what many companies do now around their healthcare benefits. It has different segments. It consists of making customized financial plans for each employee, having a regular financial review, a financial educational programs as well as bringing in professionals to give sessions to employees on managing debt repayment or other money management strategies. Having access to personalized financial plans and educational content, along with professionals that can help employees navigate their financial lives, creates a culture for wellness in the work-space.
In our country, a culture of Fee-only financial planning is only in its beginning stage. For most of us, investment advisers are people who sell us mutual funds, getting a decent commission from mutual fund companies. Hence, starting an employee financial wellness program needs a lot of awareness and convincing to be done. That said, there a lot of companies in India who have felt the real need of introducing a wellness program and are taking baby-steps towards implementing it.