Like any good workout routine, financial wellness seems to benefit from regular “exercise.”
A new report claims that workers who repeatedly engage with financial wellness programs offered by their employer are benefiting from a “compounding” effect, where gains in financial health grow over time – and women are not only the biggest users of such programs (71%), they also dominate as repeat users (76%), as they have since 2010.
That’s the conclusion of the Financial Finesse Financial Wellness Think Tank's 2017 Year in Review report. As a provider of those services, Financial Finesse might be seen to have a certain bias – though they are also arguably in a prime position to see the impact of these programs over a sustained period.
Researchers found that for companies with multi-channel programs in place for three years or more, the repeat users are:
- twice as likely to be on track for retirement (43% of repeat users are on track for retirement, compared to just 19% of employees who are engaging in the financial wellness benefit for the first time);
- nearly half as likely to suffer from unmanageable financial stress (about one in seven repeat users (14%) report high or overwhelming levels of financial stress, compared to one in four (27%) new users); and
- significantly more confident investors (60% of repeat users are confident their assets are allocated correctly, compared to just 39% of new users).
Additionally, the average Financial Wellness Score™ of repeat users improved 22% from their first assessment (5.0 out of 10) to their last assessment (6.1 out of 10). Financial Finesse’s ROI model suggests that could result in an average gain to a 10,000-employee company of more than $500,000 per year from reduced absenteeism, wage garnishments and increased tax savings from contributions to HSAs and FSAs (and doesn’t include additional gains that could result from reduced turnover, financial stress, and costs of delayed retirement, which are benefits frequently touted for these programs in workforce management).
Moreover, the report finds that repeat users have increased from 33% of total financial wellness benefit users in 2016 to 58% in 2017.
That said, if repeat users showed improvement, there remained signs of weakness in the report: The percentage that are not on track (i.e., the “underfunded”) remained constant – nearly 7 in 10 employees (69%) are still unsure, or not on track for retirement, and while 92% reported participating in their employer-sponsored retirement plan, only 76% are contributing enough to earn the full employer match.
