Successful Programs Result in Less Stressed Workforce According to New International Foundation Report
Brookfield, WI (November 3, 2014) — Employers in the U.S. and Canada that have implemented financial education programs say their employees are less stressed, more prepared for retirement and have a better understanding of their finances, according to a new report from the International Foundation of Employee Benefit Plans. Also, organizations that have seen success through financial education offerings are more likely to provide a greater variety of topics and formats, and to customize participants’ education.
Of the 397 organizations that participated in A Closer Look: What’s Working in Workplace Financial Education, more than two-thirds stated they offer financial education to employees. Among employers offering financial education, only a third have a workforce that is somewhat or very highly stressed, compared with 43% of respondents that do not offer financial education.
“The survey found that while the benefits of financial education may take a few years to emerge as employees learn about their options, the rewards are long-term. Staff are smarter about their future and more focused during work,” said Julie Stich, CEBS, Director of Research at the International Foundation. “To increase a program’s impact, it’s critical to reach as many employees as possible. Organizations with programs they consider to be successful experience double the average participation rate in initiatives (42.6%) compared with organizations with unsuccessful programs (21.3%).”
Overall, of the 270 respondents that offer financial education opportunities, more than 66% stated their initiatives are somewhat to very successful for their employees. Employers that have seen greater success in their programs report a robust financial education strategy. Of the 170 respondents that said their programs are successful:
- 84% offer education during normal work hours (compared with 81% of employers with unsuccessful programs);
- 50% provide financial education to participants’ spouses (compared with 31%);
- 35% have assessed which financial education topics are most needed (compared with 8%);
- 32% provide services to retirees (compared with 18%); and
- 32% have a budget devoted to financial education (compared with 9%).
Employers also shared their views on why they provide financial education to participants. Notably, 61% of respondents with successful programs stated that it’s important to improve participant/employee retirement and investment decisions. And, 45% of these employers believe it is the organization’s responsibility to educate staff on pension and benefit options, encourage retirement savings and improve participant money management.
The report also found that organizations with successful programs cover more topics in their financial education programs than organizations with unsuccessful programs, on average seven versus four. Topics offered to participants include retirement plan benefits, budgeting/spending plans, employment after retirement, annuities, wills and estate planning, and life insurance. Likewise, employers with successful programs also use a wider variety of educational methods than employers with unsuccessful programs, seven versus five. Methods by which organizations provide educational services include voluntary classes, newsletters, email, workbooks, online resources and courses, retirement income calculators and free personal consultations.
“This report highlights the fact that financial education programs have made an impact on employee well-being – financially and mentally,” said Stich. “We are encouraged that two-thirds of our respondents consider their programs to be successful, and are hopeful that employers will emphasize the important role financial education has on employees’ overall well-being.”
A Closer Look: What’s Working in Workplace Financial Education uses data from the International Foundation’s report, Financial Education for Today’s Workforce: 2014 Survey Results. In total, 397 completed responses were received throughout February 2014 (310 from the United States and 87 from Canada). About two in five respondents represent corporations, nearly one-third represent multiemployer trust funds, and about one in five represents public employers/governmental entities. The new report takes an in-depth look at the original survey data to determine whether organizations with financial education are experiencing better outcomes compared with those not offering financial education; and compare the strategies and initiatives of organizations having success with financial education with organizations not experiencing success.
About the International Foundation of Employee Benefit Plans
The International Foundation of Employee Benefit Plans is a member-driven organization with six decades of experience as a leading objective source of employee benefits education and information within the American and Canadian workplace. The Foundation’s expertise is industry wide and it offers resources that include training, conferences and research on topics critical to assisting its 35,000 multiemployer, corporate and public sector members respond to trends affecting the well-being of more than 25 million lives in North America. For additional information, visit www.ifebp.org