Are you distracted at work by personal finance worries,
like getting a credit card payment in the mail on time, or wondering if you
should review your retirement plan with an expert? You've got plenty of
company. Twenty-four percent of employees report that their own finances drain
their workdays of attention, according to a 2014 PwC survey of employees whose
employers offer such plans. That partly explains why a financial wellness
program is probably coming to your workplace, if it isn't already there.
Typically comprised of financial planning diagnostics,
information and, often, employer-subsidized time with a financial planner or
coach, workplace wellness plans are taking off. A new Aon Hewitt survey
predicts that 93 percent of U.S. employers expect to create or expand financial
wellness efforts this year, and 67 percent of employers intend to communicate
with employees about the physical health ramifications of financial stress.
Here's what you might soon encounter at work and the latest in how to make the
most of financial wellness plans.
The definition of
"wellness" is evolving. It used to be that "financial wellness"
was mainly about managing credit and debt wisely; saving for retirement
and other big goals; and actually reading your benefits statements. Now,
employers are merging in a much broader array of topics in a more holistic
approach, says Kim Davis, senior vice president of human resources for NFP, an
Austin-based employee benefits and insurance brokerage firm.
Raises, for example, are forecast to be in the range of 3
percent to 4 percent, but higher-level staff and star performers are likely to
be granted profit-sharing, Davis says, as compensation finally gets back to
where it was before the recession. Those lucky employees will need additional guidance
in how to invest and manage those funds, especially if the bonuses are in the
form of stock options, company shares or other hard-to-value perks. Relevant
to all employees, some wellness plans are incorporating projections about
Social Security income into retirement planning, Davis says.
Taking cues from
physical wellness programs. Financial wellness programs appear to be taking
cues from their predecessors, workplace health and wellness programs, and that
might mean you get a financial planner or coach. Health wellness programs lost
momentum when they consisted only of education. It also takes accountability
and relationships to motivate people to adopt new habits, says Thomas Ruggie,
president of Ruggie Wealth Management in Tavares, Florida.
Financial planners are eager to work with employers to gain
access to planner-free employees, but employees don't necessarily return the
sentiment. The PwC survey of employees in financial wellness programs found
that only 7 percent regarded a personal financial planner as essential to
achieving their financial goals.
That's where the parallel with health and wellness
programs is guiding some employers' expectations. Just as someone might be
motivated to diet in advance of a milestone event, such as a class reunion, and
only then turn to the workplace wellness program for help, operators of
financial wellness plans are realizing that a major life event is likely to
prompt many people to act on their financial goals. High-stakes events such as
weddings, the death of a parent or looming college enrollment often catalyze
action, advisors say.
Virtual reality experiences are intended to yield real-life
insights. Games, interactive websites and apps are the latest channel
for drawing employees into the world of financial choices and consequences,
Davis says. Inviting employees into a virtual world where they start and run a
small business, for instance, gives people a chance to understand financial
management and takes away the stigma of realizing that you're not in a good
financial place, which is embarrassing.
Experts agree that games are all well and good, but they
aren't very helpful until they translate virtual situations to all-too-real
reality. Before spending time in a virtual financial maze or competition with
co-workers, bone up on what you need to learn so you're backfilling gaps; for
instance, if you struggle with investing basics, choose a role that lets you
direct a portfolio in the game. And it's still on you to apply what you learn
in the game with the variables in your real portfolio and plan.
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