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How Financial Wellness Benefits Can Impact Your Employees’ Health

July 18, 2022, by New City Insurance

employee with utility billsFinancial concerns can have a direct effect on an employee’s emotional and physical health. Stress over money has been linked to migraines, depression, sleep problems, heart disease, diabetes, and other serious conditions. Financial stress can impact nearly every facet of a person’s life, including their ability to perform their job duties effectively.

Ever-increasing medical bills, a large amount of debt, and many other scenarios can lead to a financial crisis. To aid employees in need of financial relief, many employers are now offering financial wellness benefits as part of a comprehensive benefits package. In fact, the number of employees offering financial wellness programs increased to 46 percent in 2021, up from 40 percent in 2020.

Before implementing a new financial wellness benefit, consider how this type of program could improve the financial health, physical health, and mental health of employees. It is also important for employers to understand the costly consequences of waiting to add financial wellness to their employee benefits package.

How Financial Wellness Benefits Improve Employee Health

According to a 2021 survey published by the Society for Human Resource Management (SHRM), approximately 74 percent of HR professionals surveyed reported that their organization has not added or expanded benefits to help employees manage their financial stress since the start of the COVID-19 pandemic.

Financial wellness can include a variety of factors that relate to a person’s current relationship and standing with money. Employees who are financially well can confidently handle their present and future financial needs.

It is important to understand how financial wellness benefits can improve employee health financially, physically, and mentally.

Financial Health

While it may seem obvious that financial wellness benefits can improve an employee’s financial health, employers should take the time to understand how these benefits can make a difference.

Employees who have poor financial health are often unable to effectively manage and prepare for their current and future financial needs. These individuals may have difficulty taking action when stressful financial situations occur and may make poor financial decisions due to anxiety, insecurity, or fear about their financial situation.

employee savings conceptThe longer that an employee is forced to deal with financial problems, the more likely they are to continue making poor choices regarding debt, money management, and similar financial topics. Breaking this exhausting cycle can be challenging, especially when employees do not have the resources necessary to make essential changes.

Many employers already offer their workforce certain benefits designed to improve their financial standing, such as a 401(k) that helps workers accumulate long-term savings for retirement. Educational benefits can also be useful for certain employees; however, these types of benefits do not always provide the financial education employees need.

Offering a comprehensive financial wellness program as part of an employee benefits package can have a powerful impact on a workforce’s financial health by delivering the resources, tools, and knowledge needed to reach specific goals.

Physical Health

Financial matters are one of the most common causes of stress. According to a recent Harris poll, money was found to be a major source of stress for 44 percent of respondents. Some of the most common causes of money problems included low income, too much debt, the rising cost of healthcare, and a lack of retirement savings.

Stress can have a significant impact on an employee’s physical health, resulting in ailments like respiratory symptoms, high blood pressure, high rates of tension, and somatic issues. In addition, stress can lead to chronic sleep-related difficulties like fatigue, insomnia, and night terrors which affect a person’s ability to perform their job duties.

When an employee’s physical health suffers, the business that they work for suffers too. The physical burden of financial stress can result in higher rates of absenteeism and lower productivity in the workplace. Chronic financial and physical stress can also lead to increased healthcare costs.

Fortunately, financial wellness benefits can help reduce these costs and help employees reach a more comfortable financial standing. In some cases, implementing financial wellness benefits can actually save businesses money in the long term.

Mental Health

stressed empoyee in officeAlong with physical stress, financial problems can negatively impact a person’s mental health. When an employee is dealing with never-ending bills, growing debt, and insufficient income, it can cause chronic worrying, depression, and an overall feeling of being overwhelmed.

According to the Money and Mental Health Policy Institute, approximately 46 percent of people with problematic debt also suffer from a mental health problem. In addition, 39 percent of people with existing mental health problems revealed that their financial situation has worsened their mental health.

Depression and feeling low can cause employees to have a general lack of motivation. Some employees will overspend in an attempt to feel better about their life or avoid taking necessary actions to help manage their spending, such as opening bills that come in the mail.

It is not uncommon for certain situations to trigger feelings of panic or anxiety, such as opening envelopes. Constant worrying about money can lead to sleep problems and can affect a person’s relationships and social life. Some employees may feel isolated or lonely as they do not have the funds needed to go out and do the things they like to do.

Financial wellness benefits can help by educating employees on how to make good decisions when it comes to money. Once employees have their spending and money situation under control, many people notice a significant improvement in their mental health.

What to Know About Offering Financial Wellness Benefits

Financial wellness programs are about much more than just finances. There are many aspects to consider when establishing a new or expanded benefit, starting with what the benefit consists of. There are many misconceptions as to what a financial wellness benefit is and what it is not.

A quality financial wellness program offers a combination of resources, tools, and education to help employees take the appropriate actions to reach their goals. It is not enough to provide a budgeting app or host a financial education webinar. Employees require ongoing benefits to help manage their finances over the long term.

finance money debt credit balance conceptWhen choosing to bring in professionals to assist employees with their finances, it is necessary to hire the right experts. Employees often thrive when provided with personalized, one-on-one guidance. Financial professionals should have strong credentials and should be bound by the fiduciary standard.

Offering financial wellness benefits can have many positive impacts in the workplace. They can lead to higher productivity levels, lower health care costs, higher participation in voluntary benefits, fewer workers’ compensation claims, less reported stress from employees, a reduction in 401(k) loans, higher participation in employer-sponsored retirement savings plans, lower employee turnover, and fewer days of work missed by employees.

Reach Out to New City for More Information

The pandemic has put a significant strain on businesses and their employees. Although the economy is slowly recovering, employees continue to struggle financially. To address their ongoing financial issues, many employees are choosing to leave their current job in search of employment that offers more benefits and better pay.

At New City Insurance, employers have access to professional benefits consulting services designed to help businesses reach their goals. For more information about how financial wellness benefits can impact employees or to request a consultation with a benefits consultant, contact New City Insurance today.

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Filed Under: Benefits,  Wellness Plans

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New City Insurance
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Carol Zhang
Carol Zhang
04:29 06 Mar 22
As a rapidly expanding national media organization, the employee benefits strategy and administration that New City has provided us during our growth has been invaluable. They have been proactive about informing us of the different benefit strategies available to us as we grow as well as managing the additional compliance laws and reporting requirements at each stage of our growth.
Claudia Villalobos
Claudia Villalobos
20:14 03 Mar 22
New City Insurance made navigating through all the health insurances super EASY. Their documents are highly informative, professional, and easy to work with. Thank you for making the process of choosing a health plan so simple. You guys are THE BEST!
Philippe Salas
Philippe Salas
17:02 22 Feb 22
I never expected to have a good time talking to an insurance salesman, but let me tell you Brendan was quite the treat. He was very helpful explaining the options and has a wonderful sense of humor. I hope to speak with him every time I call.
Jennifer Polito
Jennifer Polito
17:15 09 Feb 22
Super easy enrollment process. Fast and friendly customer service. If you are looking for an insurance company that is there for you every step of the way I highly recommend New City Insurance.
Rocky Salas
Rocky Salas
23:46 07 Jan 22
So friendly, I hope to speak to him again in all my future insurance needs.
Rocky Salas
Rocky Salas
23:38 07 Jan 22
So friendly and soft spoken. I hope to speak to him again in all my future insurance needs.
Jose Brena
Jose Brena
13:20 06 Jan 22
Eric Calciano has been extremely helpful in finding and selecting the right insurance coverage for our company. With many options out there Eric assisted us on getting a low cost provider saving more than 20% than from our competitors and providing excellent coverage for our employees.
Anastasia Beaverhousen
Anastasia Beaverhousen
17:05 28 Dec 21
Signing up for insurance was quick and easy. Felicity Sundsboe
SFCC
SFCC
22:08 29 Nov 21
Jeff Stoltey and his team provide excellent customer service. Jeff has always provided my company SFCC with straightforward options. I went to a larger insurance company only to RUN BACK to Jeff at New City Insurance. I recommend them to anyone needing insurance without hesitation.
Kevin Luby
Kevin Luby
19:13 22 Oct 21
Quick, easy & informative. We were able to secure quality insurance for our small business on a tight deadline. Thanks for the help New City.
Theresa Ruybol
Theresa Ruybol
19:30 01 Jul 21
Eric was so great with us. He was very patient and kind as we are a newer smaller organization who is growing rapidly. With that said, we had made our inquiry, he had great rapid response and mostly had to wait on me. Any request that we made and/or questions we had, he was great answering and helping us understand. Then when we were ready for all documents and to move forward, Brendan helped with getting that together and the two of them worked their magic on New City's end to notify me of what was needed, assist me in that process and confirming that all was complete and approved for the coverage. I just want to say thank you all again so much, as insurance has always been confusing to me, and you all made that process go a lot smoother.Thank you
Andrea Ordendorff
Andrea Ordendorff
21:06 07 May 21
I've been working with both Clayton and Brendan for well over a year. As the purchase of our dental practice was delayed well over 14 months they both patiently supported me and continued to make themselves available. When we were officially ready to sign up they made the whole process seamless and super easy. This team is highly knowledgeable, professional, supportive, and efficient! I can't thank them enough for everything they've done.
T W
T W
22:32 30 Aug 20
I love New City Insurance. I never had a good experience dealing with insurance brokers until I started working with Brendan. He’s awesome! He is patient with me and takes the time to answer all my questions. I’m very grateful for all his help and hard work!
Mary Jane Deyette
Mary Jane Deyette
00:57 11 May 20
Jeff Stoltey is so awesome...even thru my company had only two employees, he took the time each year to research and find the best plan for us. The only reason I am leaving New City Insurance is because we no longer have any employees. Thank you Jeff
Alma Ortiz
Alma Ortiz
22:25 23 Feb 20
Brendan was awesome! I couldn't figure out how to pick my plan and he returned my call on a weekend to help me. Outstansing service!
jessica kavanagh
jessica kavanagh
19:53 13 Feb 20
Brendan was so helpful I definitely recommend him if you’re in need of good help and getting it done promptly. Thankyou so much again.
Tricia DeYoung
Tricia DeYoung
19:49 13 Feb 20
I was very thankful I inquired about this info. with Brendan. He was very helpful so I understand the benefits available much better now. Thank you Brendan.
B Bayer
B Bayer
17:43 24 Sep 19
NCI handled almost everything from start to finish. Clayton and Brendan made the plans easy to understand and walked me through the application process. They got me my ID numbers before my cards arrived so that I could keep an appointment I had already scheduled. My last broker wouldn't have done that. 5 stars!
Jessica Lehr
Jessica Lehr
03:36 07 Jun 19
Our staff was interested in a health plan, but we didn't know how beneficial a solid employee benefits package would be for our business to expand. We'd lose prospective employees because they had more options for their medical insurance which was sometimes more valuable than more pay. The New City team was amazing and gave us as many affordable options as possible so that everyone had their needs met.
Mike McClay
Mike McClay
19:36 03 May 19
My employer uses New City as their insurance broker, and I'm always amazed when I call in for assistance by how knowledgeable and attentive their staff is with my requests. Their online benefits platform makes selecting insurance plans pretty darn easy. I would highly recommend their services.
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