Companies have continued to bring on financial literacy programs as a benefit to their employees. It’s no question that it proves to be helpful for workers, especially as we face inflation and other global economic turbulence. But there’s another reason why financial wellness benefits through work are important — it directly affects people’s mental wellbeing.
A recent survey by TalentLMS, a learning management system backed by software company Epignosis, found that of the 1,000 U.S. employees surveyed, nearly half of them admit having experienced physical and mental health issues due to money-related stress. Only 5% say that they have met their financial goals, with inflation and insufficient income being the two main obstacles to reaching those milestones. Talks of a recession have made seven in 10 employees more concerned about their financial wellness.
The impact the financial crisis has on people’s mental health varied by generation in the survey. Millennials appeared to be facing the greatest challenges, with 66% of them saying they have had mental health struggles due to money, compared to 59% of Gen Z, 47% of Gen X and 24% of Baby Boomers.
“By offering financial benefits, which is what they need, in turn, you help relieve that stress,” said Christina Gialleli, director of people operations at Epignosis. “Happy people are people that don’t quit their jobs and are more productive in their jobs.”
The TalentLMS survey found that when it comes to financial wellness benefits, retirement planning, investment programs, and emergency savings are the top three financial wellness benefits employees would like to receive from their employer. Of the 51% surveyed that are receiving financial wellness training from their company, 73% say it is helping them feel more safe and secure.
“We’re transitioning to not a one size fits all benefits package,” said Gialleli. “It’s really, really important to maintain flexibility.”
“Every serious company offers some sort of mental health support for employees, but that’s addressing the result,” she continued. “We need to get to the cause of the problem. Since financial uncertainty is one thing that is causing stress, we need to be proactive.”
Results published in early November from the Employee Benefit Research Institute’s annual financial wellbeing employer survey found the same thing. A total of 84% of the 250 companies surveyed found that their financial wellbeing benefits are being used to improve mental health and emotional wellbeing. That could be happening indirectly, as mentioned above, or more directly with offering financial assistance for mental health coverage for things like therapy.
Craig Copeland, director of wealth benefits research at EBRI, said that the survey found that among the companies participating, there was an increased number of webinars and information sessions focused on the high cost of living and how to deal with inflation.
“Now people are more careful on what they’re spending because the price of necessities is going up,” said Copeland. “That requires a more holistic approach when it comes to financial benefits.”
He says instead of employers tapping into just student debt or retirement savings, for example, programs focused on entire financial profiles have proven to be more successful. Either way, though, companies are increasingly considering how financial situations impact mental health.
“There is some growing use among companies of trying to provide financial therapists, who could address the mental health aspects of financial uncertainty,” said Copeland.