Matt is the CEO & co-founder of Origin, where he is working to solve employees’ number one source of stress: money.
For many people, their employer — who provides them with a salary, retirement account, health insurance and benefits — is their primary source of wealth creation. That’s why I firmly believe that it’s the responsibility of companies to take care of the complete financial needs of their workforce. But to accomplish this, employers should go beyond offering a competitive salary and benefits. Cultivating a company culture that holistically supports employees’ financial wellness is just as important.
Why A Culture Of Financial Wellness Is Important
It’s not uncommon for people to feel embarrassed by their financial situations, which can make them unwilling to discuss the subject with their friends and family, let alone their colleagues. But if they don’t have a place to discuss their problems or ask for help, the feelings of guilt can pile up.
In an ideal world, everyone would have a financial advisor to talk to. But the truth is that these services are expensive and out of reach for many people, which is likely why 99% of Americans don’t use advisors, according to 2019 CNBC data. Additionally, many people feel uncomfortable talking about money — a recent Insider survey revealed that more adults regularly talk about politics and sex/relationships with their friends than money.
Employers are uniquely positioned to help employees by offering resources, guidance and a safe space to talk about finances.
And this isn’t just beneficial for employees — there could be business incentives, too. Financial matters cause your employees more stress than any other factors combined, according to 2020 PwC data. Additionally, 21% of respondents to a 2020 survey from Thrive Global and Discover reported negative finance-related impacts on physical health. Addressing the sources of that stress may allow your employees to be more present, productive and healthy at work.
Three Ways To Cultivate A Culture Of Financial Wellness
So what can you do to create a workplace that makes employees feel safe and comfortable discussing money at work? Here are my three suggestions:
1. Normalize Talking About Money At Work
In order for employees to feel comfortable talking about money at work, someone has to start the conversation — and I would argue that it has to be someone at the top.
Before I started Origin, I was running a software company. The most common questions I heard from employees had to do with their finances. How does their equity work? What’s the best way to learn about investing? How much should they be contributing to their retirement account?
You may not be able to answer most of their questions. But you can recognize that it is your responsibility as a company leader to get them the guidance they need — and create a culture where your employees feel safe enough to be curious about their finances.
At our organization, we’re very transparent when it comes to talking about our financial journeys. And I hope that more companies will encourage this type of openness at their own organizations. I believe this is a critical component of helping employees get where they want to be in terms of financial wellness.
2. Invest In Financial Wellness Resources
Many people aren’t financially literate. In a 2018 FINRA survey, only 40% of U.S. respondents were able to correctly answer four out of six financial literacy questions correctly.
In response, many companies offer educational resources to address this gap. The problem is that many of these programs rely on the “old school” approach of presentations and brown-bag lunches, which I believe fail to be engaging or actually change behaviors in meaningful ways.
That’s why it’s important to pair your education efforts with financial wellness tools that will nudge employees to take action and create lasting change. For instance, you could give employees access to money-management apps, provide a budget to receive financial coaching or share resources that help them understand the best way to pay off their debts.
3. Set Your HR Team Up For Success
Your HR team members are the gatekeepers to your company culture. Everything — from the benefits they choose to the policies they enforce — contributes to the work environment. If your HR team doesn’t have the capacity, support or resources necessary to address the financial needs of your employees, your culture will likely fail to change.
That’s why company leaders should prioritize the needs of their HR teams, which can then help them support the financial wellness of employees. Here are a few ways to set HR up for success:
• Invite a financial specialist to address specific questions about equity, compensation and financial benefits with employees.
• Your HR team is already stretched thin, so don’t put the burden of financial education solely on them. Instead, encourage them to lean on external financial advisors or benefits vendors (such as your retirement plan provider) to inform their educational materials, resources and events.
• Demonstrate your support for the financial initiatives your HR team rolls out — whether that’s by joining the events, participating in conversations or simply promoting their hard work to the rest of the organization.
Cultivating a culture of financial wellness doesn’t have to be a huge or dramatic change. If you already have a strong foundation, the shift will likely be small — but powerful. By creating a workplace where it’s not just accepted but also encouraged to raise, discuss and take action on financial situations, you can invest in both the success of your employees and your business.