Wellness programs, health promotion programs, health assessments, health fairs, discounted fitness programs, chronic disease management programs, etc., are just some of the names for employer-sponsored programs designed to improve the health fitness of employees and at least slow the damage to (if not improve) the employer's health care bottom line.
These programs have all worked to varying degrees, and no one would deny that desperate times call for creative measures where stemming the rising cost of health care is concerned.
Employers get it. They know that employee health care costs pose a huge administrative expense, and they are doing what they can to rein in that expense. After all, continuing on the path of runaway health care costs would undoubtedly hurt the financial performance of many companies.
So that's it. Attack health care costs though a varied assortment of health care promotion programs, incentives and the like, and this action, while not solving all of life's problems, will surely be the tonic for controlling costs and creating a healthy workforce.
While one probably can't argue against this formula, one might question whether employers are going far enough and being aggressive enough in the campaign to create a healthier workforce.
Is our scope too narrow? I would argue yes.
To put a disproportionate share of our focus on health promotion programs and disregard the importance of a financially well employee - not a wealthy employee - but a financially comfortable employee, is ignoring a major portion of the overall wellness solution.
I don't make this argument from the standpoint that a good employer is an employer that thinks of the employee holistically and takes care of all of the employee's needs. I make this argument because financial wellness can be, and often is, a key component to an employee's physical wellness and, certainly, the employee's overall wellness.
Compensation is not enough
Many employers believe that because they offer competitive compensation programs, their work is done in the area of employee personal finance. Certainly, an employer can choose to drop off the map after those 2% salary increases are divvied up among the employee population.
But an astute employer, particularly one that is already investing significant dollars in health promotion, will see the benefit of assisting employees in becoming savvy savers, spenders and investors as well. These employers understand that by improving the financial wellness of employees, they are also creating an environment for better overall employee wellness.
"The Difference," by Jean Chatzky is testimony to the fact that people at different levels of financial wellness possess very different characteristics. She calls people with the lowest level of financial wellness Further-in-Debtors.
She describes them as unhappy and insecure, and goes on to say that nearly half get physical symptoms like insomnia, heartburn, stomachaches or headaches when they think about their finances. For health and productivity reasons, you'll want as few Further-in-Debtors in your workforce as you can possibly have.
On the other hand, she describes the Financially Comfortable, her second-highest level of financial wellness after the Wealthy, this way: "Although they're not as satisfied with their social lives, health or sex lives as the wealthy are, they're just as satisfied with their family life, which makes sense, since they are more likely to be family-focused.
The Financially Comfortable stick to a budget and are careful about how much they spend. Nearly 70% of the Financially Comfortable pay off their credit cards in full every month, and three-quarters devote a chunk of household income each month to personal savings."
As you might guess, the Financially Comfortable probably sleep well at night and are able to give 100% while on the job. I believe it is highly unlikely employers are getting that kind of effort from the Further-in-Debtors and, for that matter, from their Paycheck-to-Paycheck personnel that Chatzky describes as the second-lowest level of financial wellness.
Financial control
Clearly, employers have determined that the primary focus of their efforts to rein in health care costs starts with health programs that promote a physically healthy workforce but, just as clearly, employers are only attacking one piece of the wellness pie.
Few of us have had formal education in personal finance management. In fact, the personal finance training programs in our schools today are growing, but are still limited in scope and are often optional.
Employers need to provide the resources necessary to support a financially literate workforce. Such a workforce has the potential to attain optimum overall wellness - a combination of financial and physical wellness. The payoff for the employer can be greater than that attained by simply focusing on physical health.
There is no magic formula that will lead to a financially fit workforce. While you won't catch all employees with a financial wellness campaign, just as you won't catch all employees with a health wellness campaign, a serious effort to improve the financial IQ of the workforce will do much to promote overall employee wellness. An effort to improve the financial fitness of employees and reduce health care costs will undoubtedly lead to a more productive workforce and an improved bottom line.
A training program that covers the basics of tracking and budgeting expenses, short- and long-term goal setting, credit and debt management, the magic of compound interest and where to obtain resources for financial planning will serve as a nice platform for more sophisticated training that may follow, such as investing beyond one's 401(k) plan, housing and mortgage matters, insurance and retirement planning.
Not only does the employer gain at the bottom line by having a financially and physically healthy workforce, but goodwill among the employee population is immeasurable. And word will soon spread that your company is a first-rate employer-of- choice.
Contributing Editor Wayne Hanson, SPHR, CEPF, is an HR consultant with a special interest in financial literacy. He has provided support to the private sector in a number of different capacities.
Survey shows women, more than men, fret about retirement savings
A survey of 401(k) participants uncovers some surprising trends along gender lines in participants' attitudes about retirement planning and investing.
The online survey of more than 1,000 of MassMutual's retirement plan participants found that, overall, 75.8% of participants were optimistic about the stock market, trusting that there will be an upswing in the next 12 months, compared to only 7.6% who think it will decline.
However, while women were just as optimistic as men in regards to the market outlook, women were notably less confident in making their own investment decisions (32.5%), compared to men (47.8%). Similarly, more men enjoy managing their investments (61.5%) than do women (48.1%). Also, women shy away from managing their accounts so much so that 39.3% of women prefer to spend as little time as possible on investment decisions, compared to 28% of men.
In total, 70.9% of participants enjoy learning about investments compared to 8.2% who don't, while a higher percentage of men (75.4%) enjoy learning about investments as opposed to 63.1% of women.
Further, the manner in which male and female participants prefer to learn about retirement planning also differs. "By an overwhelming majority, participants prefer to receive their information from their retirement plan provider and financial adviser - 67% combined - than other sources," says Elaine Sarsynski, executive vice president of MassMutual's retirement services division. "It is incumbent upon providers and financial advisers in the retirement space to provide the information necessary to help both men and women make good decisions."
When asked how they approach retirement planning in the current economy, 40.3% reported becoming more conservative, 32.9% became more aggressive, and 26.8% have not changed their approach. -Kathleen Koster
