Lessons From COVID-19: An Opportunity for Financial Wellness

The arrival of COVID-19 was a wake-up call for employers and employees alike.

For many that were already struggling to get by, the pandemic added financial stress through an economic downturn, job losses and no timetable for how long the slump would last. A PwC survey of employee financial wellness found that over the past year, more employees have considered filing for bankruptcy protection than ever before.

And the economic uncertainty is still dealing blows more than a year later – as finances continue to be the top cause of stress for employees – with PwC reporting that two-thirds of respondents reported increased financial stress.

But as things slowly start to improve with widespread vaccines and signs of a rebounding economy, there is an opportunity for employees to make financial changes to prepare them for future hardships. And there’s an opportunity for organizations to foster a culture of financial wellness to help them get there.

Here are some tips for organizations to help employees achieve financial wellness:

Offer Customized Employee Financial Literacy Programs

Many organizations now have a golden opportunity to understand their employee’s financial needs better and cater to them. Employees come from all different backgrounds, and are at different stages of their life and different levels of financial stability. Some may be living paycheck to paycheck, others may have a small nest egg they are looking to invest for the first time, and others may be looking to build on their investments and protect their assets. Thus, it is important to offer programs that can be customized as opposed to a one-size-fits-all approach.

Encourage the Use of Digital Tools

Digital apps can help navigate and organize an employee’s financial information, as well as other aspects of their life to help them achieve a more favorable work/life balance. Some of the more popular tools include Google’s Digital Wellbeing site, Digital Garage and Calm, among others. Implementing digital wellness tools into a financial wellness program will pay dividends for organizations, which will benefit from a productivity standpoint when their employees are more stable, focused and happier.

Make Finances Fun

One of the most common challenges that employees face during financial trainings is the ability to fully absorb the often information overload. When evaluating the nature of a financial wellness program, it is critical to find interactive ways to engage employees. Research from Elsevier and Procedia showed that combining fun in learning helps boost motivation and long-term memory. Complementing this notion, game-based learning methods like the Investopedia Stock Market Simulator or classic real-estate board game Monopoly are great examples of how simulated financial lessons are effective tools in the real world.

Financial well-being is not a destination you can reach overnight, but planning, patience and commitment can go a long way. A consistent and holistic approach to financial health includes participation from both employers and employees. From employer-sponsored savings plans, to variable pay and incentive-based earnings, to smart decision-making when investing in your own future, there are many ways to steadily improve your financial standing.

Above all else, if the pandemic has taught us anything, it is that we are all in this together. As many organizations are now in reset mode, it is the perfect opportunity to implement a plan to facilitate employee resilience during times of crisis.

Most of us were not expecting a COVID-19 type of event, but now that we have lived through it, we can at the very least be prepared for future scenarios. For organizations, it is an opportunity to foster new levels of employee trust and loyalty. By helping them achieve a path to financial and, subsequently, emotional well-being, organizations can be a foundation and resource for employees to lean on when they need it most.

Ed Powers is the Vice President of Membership at the $14 billion, San Jose, Calif.-based First Tech Federal Credit Union.