Building a Culture of Financial Wellness: The HR Practitioners' Role

As we continue to face economic uncertainty in the post-pandemic era, employee financial wellness has become a critical issue in the workplace. Hence, HR practitioners have an essential role to play in promoting it. Employees' financial wellness impacts their productivity, job satisfaction, and overall well-being. It's unsurprising that organizations are beginning to recognize the importance of providing financial wellness programs and services to their employees. But what is the role of HR in promoting financial wellness in the workplace, and how can human capital software help?

First, let's define financial wellness. Financial wellness is the ability of employees to manage their finances in a way that allows them to meet their current financial obligations, prepare for the future, and feel secure in their financial situation. Financial wellness encompasses many issues, from debt management to creating a budget, to building retirement security, and so much more.

HR practitioners play a vital role in promoting financial wellness in the workplace. They are responsible for implementing financial wellness programs, providing resources and education, and creating a culture that values financial wellness. HR practitioners can offer a range of services to employees, including financial education workshops, one-on-one financial coaching, and access to financial planning tools.

Promoting financial wellness in the workplace doesn't have to be costly for the company. Here are ten revenue-neutral ideas that HR practitioners can implement without breaking the bank:

1. Provide financial education resources: With online access, public libraries, and public support, access to financial education resources, such as books, videos, and articles, is more readily available than ever.
2. Offer financial coaching: HR practitioners can provide one-on-one financial coaching sessions to employees. These sessions can be conducted virtually, and the cost of individual coaching can be covered by employees or grant-funded.
3. Encourage retirement savings: When HR practitioners encourage employees to participate in employer-sponsored retirement plans, they’re not just building retirement security for their employees but also helping their employer reduce payroll tax liabilities and fostering a healthier and happier employee population. Practitioners should educate employees on retirement savings benefits and the importance of starting early. Engaging the services of their retirement plan providers makes this an easy checkmark in the win column.
4. Promote healthy financial habits: There is no expectation that HR professionals should become financial planners overnight, but it’s a reasonable expectation that HR practitioners should encourage healthy financial habits. Many nonprofit organizations have organized for this purpose and will happily speak with your employees and provide free support. Create a list of available resources in your area and make this available for your employees. Encourage all employees to create a budget, live within their means, and avoid unnecessary debt.
5. Host financial wellness workshops: HR is at the heart of every organization, so why not host and organize financial wellness workshops on topics like budgeting, debt management, and retirement planning? These workshops can be conducted virtually or in person, and the cost can be minimal or free.
6. Provide access to financial planning tools: There’s an abundance of free or low-cost financial planning tools, including budgeting apps and retirement calculators. FINRA has excellent free resources available at investor.gov, and the College of financial planning is another great resource. Don’t forget to start with your retirement plan provider. These providers know that when you take care of your financial basics, you have more funds to save and invest in your retirement plans. This creates a win-win for everyone!
7. Create a financial wellness committee: How about creating a financial wellness committee comprised of employees from different departments? The committee can collaborate to promote financial wellness initiatives and provide feedback to HR practitioners. For Public Sector employers, consider engaging collective bargaining unit members in this initiative so each unit knows their voice matters.
8. Provide resources for debt management: According to a Pew Research Center (2021) report heightened concerns about one’s financial security directly correlated to “higher levels of psychological distress.” And “psychological distress is associated with several adverse health outcomes, such as emotional exhaustion, reduced immune response, heart disease, and increased mortality (Arvidsdotter et al.,?2016; Barry et al.,?2020; Marshall et al.,?1998; McLachlan & Gale,?2018; Rasul et al.,?2005; Segerstrom & Miller,?2004).To foster a healthy workplace, HR practitioners should provide resources for employees struggling with debt, such as debt counseling and debt management programs.
9. Encourage open communication: Create a safe and supportive environment for employees to discuss financial challenges. While I’m not encouraging over-sharing, most working-class individuals have faced some economic challenge, so why not encourage open dialogue about financial issues and let employees know they’re not alone?
10. Offer flexible work arrangements: If there’s one thing the pandemic has taught us, we’re far more dynamic than previous generations. In an almost overnight endeavor, many employers shut down their traditional workplaces. They went to a fully or partially remote work environment, and employers and employees found a way to thrive. Consider offering flexible work arrangements, such as telecommuting and flexible hours, helping employees save money on commuting costs and other expenses.

HR practitioners can implement these financial wellness ideas without taking on any additional financial liabilities. By promoting financial wellness, HR practitioners can boost employee morale, increase productivity, improve employee experience, and create a healthier workplace culture.

For those employers willing to invest in their organization’s most valuable asset, there’s a comprehensive solution that elevates the HR practitioner’s experience and serves as the engine for financial wellness services delivery and human capital management (HCM) software. By automating administrative tasks, HR practitioners can focus on driving strategy and providing high-quality services to create a culture of financial wellness. HCM software can also provide HR practitioners with data and analytics that help them understand their employees' financial wellness needs and measure their programs' effectiveness.

One of the significant advantages of human capital software is that it can provide employees with personalized financial education and guidance. With the help of the software, employees can receive customized advice on managing their finances based on their unique financial situation. This personalized approach can be convenient for employees struggling with debt or needing help creating a budget.

Another advantage of human capital software is that it serves as a financial wellness hub for employees to access financial planning tools, such as retirement plan information, calculators, budgeting apps, and links to other vital financial wellness resources. These tools can help employees manage their finances more effectively and take control of their financial future, empowering employees to take charge of their financial wellness.

Finally, human capital software, like UKG’s full suite #HCM solutions, can help HR practitioners measure the effectiveness of their financial wellness programs. By tracking employee engagement with financial wellness resources, HR practitioners can identify areas where they need to improve and adjust accordingly. They can also use data and analytics to demonstrate the ROI of financial wellness programs to organizational leadership.

HR plays a critical role in promoting financial wellness in the workplace. By providing financial education and resources, HR practitioners can help employees manage their finances more effectively and improve their overall well-being. Human capital software can elevate the HR practitioner's experience, making it more strategic and less tactical, and can provide employees with personalized financial guidance and access to financial planning tools. By promoting financial wellness, HR practitioners can foster a healthier workforce and a more robust workplace culture and help employees achieve their financial goals.

At UKG , our purpose is people, and we provide #hcmtechnology solutions so you can focus on building a culture of financial wellness for your people. Visit www.UKG.com to learn more about UKG Pro and UKG Wallet, which equip employers with the tools and resources necessary for financial wellness.

About the Author:?Knickeita Bullock?is a trusted Human Capital Management Principal, passionate about building inclusive workplace cultures that allow organizations and individuals to thrive. As Principal Public Sector Consultant for?UKG, she is a thought leader who advises state and local governments on making innovative, people-centric HR decisions. Knickeita's Diversity, Equity, Inclusion, and Belonging certification complements her HCM expertise. Her work as a UKG Global DEI&B Ambassador, speaker, and Chair for Our PEARLS For Girls, a non-profit organization empowering girls and women across the globe, reflect her commitment to positive change. Connect with her for thought leadership and to learn how UKG fulfills its people purpose promise.?

Sources:

“The Relationship Between Financial Worries and Psychological Distress Among U.S. Adults” https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8806009/

1. Pew Research Center. (2021, March 16).?Many Americans continue to experience mental health difficulties as pandemic enters second year. Pew Research Center. Retrieved December 1, 2021, from?https://www.pewresearch.org/fact-tank/2021/03/16/many-americans-continue-to-experience-mental-health-difficulties-as-pandemic-enters-second-year/
2. Barry V, Stout ME, Lynch ME, Mattis S, Tran DQ, Antun A, Ribeiro MJ, Stein SF, Kempton CL. The effect of psychological distress on health outcomes: A systematic review and meta-analysis of prospective studies.?Journal of Health Psychology.?2020;25(2):227–239. doi:?10.1177/1359105319842931.?[PubMed] [CrossRef]?[Google Scholar]

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