"Think of saving as well as getting." Benjamin Franklin
The past several years have been difficult for companies and employees alike. One in seven workers currently faces debt collectors, and many people live paycheck to paycheck. Because of these financial pressures, a growing share of employees do not expect to retire by age 65.
What are we to make of these facts as owners and managers? My answer: provide financial and accounting education to all of your employees — and don't wait to do it. Ten years ago, companies began to realize they couldn't leave employees on their own when it came to managing their health; as a result, Employee Wellness Programs and Their Impact expanded across many workplaces. It's time for a similar focus on financial wellness.
To create a financial education initiative in your business, I recommend taking these steps, all of which you can find on HR That Works:
Steps to create a financial education initiative
- Make sure that management understands how the financial stress of individual employees affects the company as a whole. We did an excellent webinar on this topic with Coach George from Dave Ramsey's organization titled Overextended: A Special Program on How the Personal Financial Stress of Your Employees is Impacting Your Business.
- Give employees a basic education in accounting. This is why we brought in the best teachers in the business — the folks from The Accounting Game. I recommend having every employee watch their webinar and then follow up with a workshop so employees commit to action.
- Provide financial planning. On average, half of your employees don't have a budget and half don't have a retirement plan (often the same people). The webinar Financial Planning 101 features a member of the Certified Financial Planners Board sharing fundamentals of good personal finance.
- Expose every employee to ownership thinking and open-book management. Two of the best webinars for this are Jack Stack's Great Game of Business and Brad Hams' Ownership Thinking.
- Stress overall business acumen. To place employee financial education in its larger context, have every employee watch Kevin Cope's webinar Seeing the Big Picture: Business Acumen to Build Your Credibility, Career, and Company.
I guarantee that doing all of the above will transform your workplace: you'll see less stress, improved focus, higher profitability, and greater financial security for owners and employees alike.
For additional guidance on retirement planning and benefits integration, see The Importance of Retirement Financial Planning and Employee Benefits.
Frequently Asked Questions
How do I get management on board with employee financial education?
Start by showing how personal financial stress affects productivity and retention, and offer a short pilot workshop to demonstrate results.
What topics should a basic program cover?
Begin with budgeting, basic accounting concepts that affect the business, debt management, and retirement planning fundamentals.
Should training be mandatory for all employees?
Make core modules available to everyone and encourage participation through incentives; consider tailored sessions for different roles.
How can I measure the program's impact?
Track attendance, employee feedback, changes in benefit enrollment, and indirect metrics like absenteeism and productivity over time.