Financial Finesse held on Thursday a webcast for its clients on best practices for improving employees’ financial wellness.
Liz Davidson, founder and CEO of Financial Finesse, drew a line between financial wellness and financial education, calling wellness a “state of being,” while “education is a process, not an event.” Wellness, she said, is a “mastery of financial issues, with little or no financial stress.”
While wellness and education are distinct, they work together. “We’re coalescing as an industry, but we’re not there yet,” Davidson said.
Financial Finesse presented findings on how financial wellness is linked with physical wellness. Referring to an Associated Press-AOL poll, the company said employees who reported feeling low levels of financial stress were less likely to report suffering common health concerns like migraines, anxiety and depression. Nearly half of people who reported a high level of financial stress said they suffered migraines, compared with just 15% of respondents with low levels of stress. Anxiety and depression were reported by 29% and 23% of highly stressed people respectively, compared with just 4% of people with little stress.
Linda Robertson, a senior financial planner at Financial Finesse and one of the presenters on the webcast, said higher levels of stress were a result of cortisol being released in the brain, adding that overall wellness “goes deeper than physical wellness.”
Financial Finesse identified several benefits to employers who help their employees achieve financial wellness, including lower health care costs, increased productivity and performance, and greater employer satisfaction with their benefits. For employees, financial wellness also leads to a lower risk of delaying retirement.
“You cannot have ROI [on wellness programs] if employees don’t change their behavior,” Davidson noted. She suggested measuring employees’ progress periodically after education events. For example, Davidson referred to a Fortune 500 client of the firm that surveyed its employees 30 days after an educational seminar. Ninety percent of participants had taken at least one step to improve their financial situation and 78% had taken two or more steps. Furthermore, Financial Finesse saw an increase in deferral rates among employees who had more financial education.