A new report by the Government Accountability Office (GAO) suggests that while employers can — and do — play a significant role in workplace financial education, obstacles remain.
In March, GAO convened a select group of leaders and experts for a forum focusing on financial education in the workplace, specifically:
• the role of the employer in promoting financial literacy;
• the effectiveness of such efforts;
• how best to serve low-income and other underserved populations; and
• the federal government’s role in supporting these efforts.
Panel Observations
Participants in this forum shared the following conclusions.
• Employers are well-suited to play a role in promoting financial literacy, since they already provide information on employee benefits, have key information about employees’ lives, and are generally trusted to provide sound financial information and advice.
• Workplace financial wellness programs should be comprehensive, expanding beyond the current emphasis on retirement planning and benefits to include education on such areas as everyday budgeting and money management, building an emergency savings fund, and understanding the financial impacts of health care.
• Effective practices can include automatic enrollment in retirement plans, financial health checks and personalization, but such approaches should complement, rather than replace, traditional financial education.
• Employers should address the needs of traditionally underserved workplace populations, including shift workers, contingent workers, low-income employees, and those with different cultural backgrounds. Strategies included tailoring the content to be relevant and understandable, delivering information though online tools and mobile devices, and leveraging partners, such as unions, churches and community groups.
• While financial education benefits employers through increased employee productivity and improved recruiting and retention, employers expect solid, independent evidence of these benefits to justify their investment.
The report is available online here.
