What does it ~actually~ mean to be financially well?
It's a question many employers ask as they explore the world of workplace financial wellbeing benefits.
For your diverse employee population, financial wellbeing may mean something different at each life stage and level of financial confidence.
To set the right goals for your workforce as a whole, it's key to define what financial wellbeing means from a holistic standpoint. Here's a definition our team at LearnLux offers for your consideration:
The Definition of Employee Financial Wellbeing
Financial wellbeing is a state of being where an employee can meet current and ongoing financial obligations. It means empowering each individual to feel secure in your financial future.
Does a person need $1,000 or $5,000 or $20 million to achieve financial wellbeing? There is no specific dollar amount that someone must have in their bank account to be considered financially well.
Instead, the definition of workplace financial wellbeing (often called "financial wellness") is closely tied to an employee's own sense of financial stress and financial confidence.
The 5 Pillars of Workplace Financial Wellbeing
Financial experts across the industry define financial wellbeing in different ways, but this quote from Claire Daily, a research associate with Corporate Insight, really captures the spirit of financial wellbeing:
Claire suggests that a person is said to achieve a state of financial wellbeing if they have:
- A manageable level of stress associated with current and future financial matters
- A manageable level of debt—or no debt at all—that can be paid off without financial penalty or significant stress on an individual’s financial situation or lifestyle
- Enough disposable income to maintain a desirable lifestyle that is within reason
- An ample emergency savings fund that can sustain an individual’s lifestyle for a bare minimum of three months
- Financial acumen that will allow them to plan appropriately for future goals and respond to unforeseen financial obstacles
Improving Your Workforce's Financial Wellbeing
Once you've defined financial wellbeing for your unique workforce, now it's time to take action. There are quite a few financial wellbeing programs on the market today, each with their own pros and cons.
Innovative employers have started looking beyond what has traditionally been considered workplace financial wellbeing. Lunch & learns, jargon-filled education from 401k providers, and point solutions like budgeting and debt paydown apps are no longer considered the gold standard.
Instead, workplaces are partnering with program providers that are unbiased, holistic, and blend digital and human guidance.
Ready to learn more about what's on the financial wellbeing market today? Click here to download the Workplace Financial Wellbeing Buyer's guide.