Why Making Financial Education a Priority for Employees
Money seems to be a fickle thing; the more you make, the more you need. Both employers and employees must abide by this rule. While most businesses struggle to accomplish more with fewer resources, employees also face this challenge and are now more indebted than ever.
For both employers and employees, some debt may be necessary, but excessive debt is typically the result of bad money management. One of the most worthwhile investments a company can make is in its employees by providing them with financial education.
Negative effects of stress on efficiency
Research indicates that more than one-third of employees experience financial stress, and as many as 50% of them experience a reduction in productivity as a result. According to other studies, 50% of employees work part-time, 75% are uneasy about retiring, and 90% of workers are dissatisfied with their financial security.
Employers are shocked to learn that about a third of these workers waste 20 hours a month dealing with financial issues at work, are less productive, take more sick days, and also experience family and health issues.
Financial education for employees
Since the Enron bankruptcy, numerous decision-makers and other leaders have urged a stronger emphasis on financial education on both the national and local levels. Regardless of their financial situation, all employees can benefit from financial education programs, it has been demonstrated.
Even for employees who only slightly improve their financial wellness, the National Institute for Personal Finance Employee Education (NIPFEE) calculated that the first-year return on investment in workplace financial education is greater than $400 per employee.
This is a sobering statistic: according to the NIPFEE, companies that offer workplace financial education could see a return on their investment of at least 300 percent.
Financial education has been used by some businesses to aid in employee hiring and training. For employers who offer defined-contribution pension plans, like the 401(k), this type of education also satisfies the Department of Labor requirement (k).
One well-known financial education course teaches participants how to give themselves a 35% raise by paying off their debt. It is provided by organizations like General Motors, US Steel, Exxon/Mobil, Daimler-Chrysler, Xerox, and Ernst & Young.
Even though this kind of raise doesn’t cost a business a cent from its payroll, it sends a message of goodwill to workers and encourages them to become more invested in their jobs. Employees gain knowledge on how to use their current earnings to achieve their financial objectives. They are less anxious and under less pressure to increase their income.
A top-notch program for financial education would be advantageous to your company for many years to come in addition to being a wise investment in your employees. There will be fewer employees working second jobs or searching for higher paying jobs, workers will be more tolerant of budget cuts that prevent anticipated pay increases, and workers who are more frugal at home should be frugal at work.
Inaction results in losses for businesses
Unfortunately, because they are unaware of the high costs associated with doing so, the majority of employers disregard employees who have personal money management issues. The truth is that employers pay a high price for employees’ poor personal financial management.
You have the option to pay now or later with the majority of businesses. If you decide to provide your staff with good financial education, your investment in them will not only help them manage their finances better, but it will also help them manage the future of your company. Your future is tied to theirs.
Employees can benefit from Admirria‘s financial education program in several ways:
•Employees may benefit from having a better understanding of financial markets and concepts, which will enable them to make wiser financial decisions.
•Employees may benefit from the program by learning trading and investment techniques that they can use in the workplace.
•Regardless of whether they work in finance, accounting, or another related field, employees will be able to perform their jobs more effectively if they have a better understanding of financial markets and concepts.