We have written many articles on employee health and wellness, which is crucial to productivity and profitability for your business. Financial wellness is important for your employees in Canada as well, it is a critical part of the overall well-being of your workforce.
What is financial wellness?
Financial wellness describes an employees overall financial state. It includes the ability to pay day-to-day bills, accumulate savings and plan for long-term financial commitments such as purchasing a home or retiring. A lack of financial literacy is a critical oversight in our education system, but that leaves an opportunity for you to set your business apart from the competition by ensuring your employees have a solid financial foundation to build on.
Financial wellness stats in Canada
It is estimated that only 40% of Canadians feel they have a strong level of financial knowledge, according to the Canadian Financial Capability Survey. This means that 42% of Canadians consider money to be the biggest source of stress in their lives. Here are some other stats to consider from the Canadian Financial Capability Survey:
- Employees with poor financial wellness took 36% more sick days than those who are financially literate.
- Distraction due to financial stress costs your company an average of $1000 per employee annually, your actual loss could be much higher.
- Studies show that stress from poor financial wellness has an impact on physical and mental health, ultimately affecting performance at work.
Benefits for business owners
If financial stress is costing your company $1000 per employee annually, a financial planning solution that costs less than $500 per employee has at least a 2x return on your investment. Offering simple financial planning services eliminates financial distractions and allows your employees to be focused on your bottom line, instead of theirs.
By combining financial planning services in your overall employee health plan, you have another tool for attracting and retaining talent. A study from the Canadian Payroll Association shows that 84% of Canadians would be interested in a financial education program offered through their work.
Financial wellness is important for your employees in Canada, however, here are some key components of a good program that will positively affect your bottom line.
- Engages employees and provides relevant and timely financial information
- Offers online planning solutions that save time and money
- Provides you with utilization metrics and data on how satisfied your employees are with the program
- Doesn’t push unnecessary financial products on employees, rather focuses on educating employees and helping them find the best solutions for their situation
- Allows employees to connect directly with a financial planner for more complicated questions or concerns.
With so many positive outcomes it is easy to see why financial wellness is important for your employees in Canada and should be a key part of your overall compensation package. Keep in mind you won’t be selling investments to your employees, rather providing an information tool to better educate them and allow them to make informed decisions about their personal finances.
The information in this material is derived from various sources. Material is provided for general information and is subject to change without notice. Every effort has been made to compile this material from reliable sources; however, no warranty can be made as to its accuracy or completeness. Before acting on any of the above, please contact us for benefit, pension and insurance advice based on your corporate or personal circumstances.