The True ROI of Employee Financial Wellness
From reducing the impact of money worries to boosting retirement plan participation, employee financial wellness programs can deliver returns that go straight to your bottom line. Learn how to track the impact of your program.
Financial stress is a reality for many of today's workers. From managing and paying off debt to saving for their children's college educations, employees are feeling the weight of common financial challenges — and many are turning to their employer for guidance.
That's where a financial wellness program can make a real difference.
The most effective programs take a holistic approach to your employees' financial health. These can include budgeting calculators, student loan repayment tools and retirement planning resources to help meet employees where they are at every stage of their financial journey. The result is a workforce that feels more confident and better prepared for whatever comes next.
A retirement strategy that includes financial wellness initiatives can empower your people with the knowledge and resources to boost their financial health now and secure a comfortable retirement. And when it's working, the results can be seen across your entire organization.
Good for your people — and your bottom line
The value of a well-rounded employee financial wellness program can be found in your retirement plan data, workforce metrics and bottom line. Here's what to track:
- Employee absences. Have you seen a marked drop in sick days, personal days and unscheduled time off? Financial anxiety is linked to absences, potentially leaving you understaffed and unable to meet organizational goals. A well-designed program can give people the tools to manage their money better and keep operations running smoothly.
- Productivity and output. Has productivity improved since the introduction of a wellness program? When your employees are less stressed about money, they're more likely to show up focused and ready to work, leaving distractions behind.
- Retention. Has turnover decreased since launching your program? When employees see that you value their wellness, it can help strengthen their loyalty to your organization. Fewer departures mean lower recruiting and onboarding costs, as well as a more committed workforce.
- Healthcare utilization. Have you noticed a shift in how employees are using their benefits? Reductions in claims, hospitalizations and chronic condition management expenses can represent huge savings over time — and healthier, more resilient employees, too.
- Retirement plan participation. Have you seen an increase in enrollment and contributions? Higher participation rates and deferral levels are a strong sign that employees are equipped to make smarter decisions and that your wellness program is translating into real retirement readiness.
- Plan withdrawal patterns. Are employees taking fewer hardship withdrawals or plan loans? This can be a positive sign that your program is helping your people create a financial foundation — and not using their retirement funds for current expenses.
- Workplace satisfaction. Do your people seem happier and more content? Tracking engagement and feedback can reveal if your program is fostering a more positive workforce, making it worth your investment.
How do I measure the impact of my company's financial wellness program?
First, know what success looks like for your organization. Are you focused on reducing healthcare claims? Improving retirement plan participation? Lowering turnover? Your objectives will shape the metrics you track.
From there, measure your return on investment (ROI) by comparing what your financial wellness program costs against what it's delivering. If a debt management resource leads to fewer hardship withdrawals from your retirement plan, for example, that's a tangible return worth quantifying.
Some results will be more obvious, like reduced turnover and increased plan participation. Others, like lower financial stress and stronger retirement readiness, may take more time to see results. Tracking both immediate wins and long-term progress can help you understand and measure the true ROI of your financial wellness program.
Put your financial wellness strategy to work
ADP retirement services specialists work closely with plan sponsors to develop comprehensive retirement plans that incorporate employee financial wellness as a part of your company culture and benefits offerings.
To learn more about improving your employees' financial wellness, get in touch or call (800) 432-401K to touch base with an ADP retirement services specialist.
ADP, Inc., and its affiliates do not offer investment, tax, or legal advice to individuals. Nothing contained in this article is intended to be, nor should be construed as, particularized advice or a recommendation or suggestion that you take or not take a particular action. Questions about how laws, regulations, guidance, your plan's provisions, or services available to participants may apply to you should be directed to your plan administrator or legal, tax or financial advisor.
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