Posted on May 10, 2023

Between an unexpected major car repair, looming tuition bills for the kids, and ballooning credit card debt, Andy and his wife were financially strained. They were both finding it difficult to sleep at night and focus at their full-time jobs. The worry was even taking a toll on their mental and physical health; Andy was often angry and short-tempered with their kids and his wife started taking sick days due to debilitating headaches.

Money is a leading cause of stress for many Americans, even those considered wealthy. Research shows that people worry about retirement savings, college tuition expenses, student loans, health care costs, credit card debt, and the ability to cover the monthly rent or mortgage payment. Employers are recognizing that these financial stressors can have a negative impact on employee productivity and overall well-being. To combat this, many companies are investing in financial wellness programs that provide participants in 401(k) plans with educational resources, tools, and personal coaching to help them manage their finances more effectively.

Some key components of financial wellness education include:

  • Budgeting: Learning how to track income and expenses and set short and long-term financial goals.
  • Saving and investing: Understanding the principles of compounding, learning about different types of investment vehicles and strategies for managing risk.
  • Managing debt: Information on how to pay down debt, avoid accumulating ‘bad’ debt, and manage credit scores.
  • Tax planning: Information on tax credits and deductions to minimize tax liability.
  • Retirement planning: Developing a retirement plan, choosing appropriate retirement savings options, and managing retirement income.

The goals of financial wellness education are to empower employees to make informed decisions about their finances and take a proactive role in managing their financial future. It’s a win for employers as well as employees: by investing in these programs, companies can help workers build financial stability, which can lead to greater job satisfaction, improved retention, and increased productivity.

This material is provided for informational purposes only, and is not intended as authoritative guidance, legal advice, or assurance of compliance with state and federal regulations.

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