The Best Benefits to Help Employees Manage Their Financial Health
October 10, 2019 | Tanya Gappy, Vice President of Employer Solutions (West)
A significant number of Americans are struggling financially. Twenty-seven percent of those surveyed in the Federal Reserve’s Report on the Economic Well-Being of U.S. Households in 2018 said they would need to borrow money or sell something to come up with $400 in an emergency — and an additional 12% did not believe they could be able to cover that amount at all.
As stark as these statistics are, employers also must realize that financial issues don’t just affect an employee’s personal life. They can also cause stress in their professional lives. Fifty-nine percent of respondents to PricewaterhouseCoopers’ 2019 Employee Financial Wellness Survey said that financial challenges were their top cause of stress, and those who said they were stressed about their finances were nearly five times more likely to say that issue had been a distraction at work.
These statistics bring to light the importance of finding ways to help employees manage their financial health. Here’s a look at how you can offer benefits to help bring financial stability and peace of mind to your employees.
The Baseline for Benefits
There is no one-size-fits-all benefits offering when it comes to financial health. Your employees’ needs will vary by demographics and by industry. The top three benefits for law firms are not the same as the top three for manufacturing plants, for example.
However, we recommend speaking with your health and welfare broker about starting with a basic benefits package of health, dental and vision insurance. These will help to prevent more costly health events and can go a long way toward ensuring financial health for your employees. Once you determine how you’ll offer these essential benefits, you can discuss with your broker(s) more targeted voluntary benefits for your specific population.
The Voluntary Benefits That Employees Should Consider
While baseline benefits help, voluntary benefits can provide even more financial security for your employees. Additionally, these benefits offerings have an organizational benefit: Not only will they help your employees manage their stress, they’ll also help with employee retention.
Here are a few examples of the other benefits employees should consider and research, even before meeting with their broker:
- Short- and long-term disability insurance: This insurance helps employees pay for expenses while they’re out of work.
- Life insurance: 70% of U.S. households with children under 18 would have trouble meeting everyday living expenses within a few months if a primary wage earner were to pass away.
- Critical illness: Beyond any other coverage, it pays if the insured is diagnosed with a critical illness.
- Accident: Beyond any other coverage, it pays if the insured is in an accident. This can help with unexpected costs the employee would not have accounted for.
- Hospital indemnity: Beyond any other coverage, it pays if the insured is admitted to the hospital for any reason.
The Importance of Communication
It’s incredibly important for your business to offer numerous benefits to help your employees. But simply offering the benefits is not enough. Employees need to understand their benefits and be guided through the enrollment process and taught how to use these services. To better help employees, consider partnering with a professional enrollment and communication firm. They have communications expertise, including customized communications options that will best serve your employee population.
Employers should also make sure their benefits administration and enrollment software can host communications. For example, if an employee has a claim two years after enrolling in the plan, they may not remember what the counselor told them and should be able to access this information quickly on their platform. Making sure software can handle communications can help employees navigate any issues with their benefits efficiently and on their own time, creating less stress for all involved.