For leaders who pride themselves on taking care of their people, financial wellness is no longer a pleasant thing; It is a must.
Within a few months, employers across the country will be welcoming millions of fresh graduates into the workplace. These new employees, as well as others who joined within the last few years, are dealing with a lot – adjusting to professional life, often in a remote or mixed environment; facing a potential slump that could define the first few years of their career; Not to mention transitioning into adulthood, possibly living away from home for the first time, figuring out how to manage a budget, set up a 401K and navigate health care costs.
Millennials—who entered the workplace during one of the worst recessions in US history and are now in their late 20s to early 40s—have a lot going for them, too. Many families have started it – a wonderful, but often expensive milestone. And while homeownership has been out of reach for many millennials, that may be changing, with two-thirds of them saying they plan to buy a home. within the next three years.
One of the biggest lessons from the past few years is that leaders need to be empathetic to what their employees, across all generation lines, are going through in their professional and personal lives. As they wrap up their benefits programs for next year, leaders should be empathetic to how little financial education their Generation Z and Millennial employees likely have received, and how ill-equipped many are to navigate these transitional periods, especially in a challenging economic environment.
Across the United States, many school systems fail financial literacy, which typically provides basic training in budgeting, credit cards, investing, and lending. according to A study issued by the American Public Education FoundationTwo-thirds of US states have C, D, or F grades for their ability to require or even offer financial literacy courses. Studies also show that those who would benefit most from financial literacy education are the least likely to receive it. The 2022 State of Financial Education Report by the NGPFfor example, it was found that only 5% of students in schools where the majority of students receive free or reduced-price lunches have access to financial literacy courses.
Across the board, Americans desperately need a better understanding of how they manage their finances. a A report by the Milken Institute It found that just over half (57%) of US adults were rated as “financially literate” when polled about basic financial concepts, and that financial literacy was significantly lower for black and Hispanic participants, creating a vicious cycle allow social and economic inequality to persist.
Financial literacy isn’t just about balances and credit cards. According to our site 2022 Workforce ReportOnly 53% of American employees say they have a good understanding of their overall healthcare costs, and 57% are very concerned about costs beyond what their insurance covers. Another study found that 6 out of 10 adults in the United States with Health insurance went into debt to get medical or dental treatment.
Because financial, physical, and mental health are so closely linked, if leaders want to offer a truly enhanced benefits plan, financial wellness needs to be a part of it. Offering educational materials, such as submitting handouts or hosting informational webinars, is a great starting point. But more relevant and actionable and TRUE Companies can make their financial literacy tools better. For example, a dashboard that allows employees to track their spending and receive tips for achieving their financial goals provides tangible results that motivate employees to participate.
Related Topics: Financial Wellness: Tailoring a program to the specific needs of employees is key
For leaders who pride themselves on taking care of their people, financial wellness is no longer a nice thing or an addition to a benefits plan; It is a must see, especially today. As we saw just a few years ago, when times are tough, a lack of financial experience can have dire consequences. Job losses in the early months of the COVID-19 pandemic drove many individuals and families into devastating debt and caused much-needed medical care to be postponed. With rising costs and the possibility of a recession on the horizon, the risks of Americans’ inconsistent financial literacy are incredibly high. As employees increasingly expect employers to prioritize and invest in their own well-being, leaders have a strong role to play when it comes to helping bridge the financial knowledge gap.
Jerry Hawthorne, Vice President, Corporate Human Resources, Aflac, Inc.