When It Comes to Financial Wellness… the Time Is Now

While one could say it’s always a good idea to focus on well-being of any type—whether it’s physical, mental, or financial wellness—there’s perhaps never been a more important time to help employees improve their financial literacy, behaviors, and resilience than right now.

More workers under greater financial strain. It would be difficult to overstate the overarching impact the pandemic has had on the financial lives of American workers. Sadly, many are struggling under increased budgetary and inflationary pressures, which can put retirement readiness at risk—or out of reach altogether. And while lately it may feel like COVID-19 exerts an uncontrollable influence on daily life, personal finance is one area where plan sponsors can help foster a greater sense of agency for plan participants through robust financial wellness programming. Financial wellness education and services which respond to the evolving needs of a changing workforce can help increase participation rates, enhance retirement readiness, bolster emergency savings, and reduce 401(k) loans.

Increased emotional and physical strain. Fears for the health of themselves and loved ones; social isolation; changes in work and personal routines; and even decreased access to preventive care due to fear or financial pressures, can put workers’ emotional and physical health at risk. Just when a transition to post-pandemic life seemed around the corner, new concerns have emerged with worrisome variants. The connection between mental and physical health is well-established, especially as mediated by the effects of stress on the body—and anything employers can do to reduce stress will only help their workers in this regard. Responsive financial wellness programs designed and implemented to meet the needs of all employees can help reduce stress and improve morale. An added benefit to employers may be a reduction in health care costs and fewer missed days of work.

Tightening job market. When businesses shuttered or were restricted during the pandemic, the demand for labor understandably dropped. However, now companies are hiring once again, the labor force participation rate has remained stubbornly low over the last few months, remaining unchanged at 61.6% in June—and down from 63.3% before the pandemic. Rising wages suggest heightened competition for qualified workers. Companies are doing all they can to attract and retain top talent during the “Great Resignation”—and offering a robust retirement plan and comprehensive financial wellness programming can help organizations accomplish this.

A Financial Wellness program can help both sponsors and retirement plan participants weather the storm brought on by COVID-19, which now appears to be lingering on our shores. There are few events in history with such widespread national impact as this pandemic. With a greater proportion of employees under stress and in need, a Financial Wellness program can make all the difference. There’s no better time than now to help your employees establish and maintain their financial health for today — and for whatever the future may hold.

For assistance, contact a KerberRose Retirement Plan Team member to discuss a financial wellness plan for your participants.

Source

https://www.nytimes.com/2021/07/02/business/economy/jobs-economy-covid.html