Recently, the Financial Health Network entered into a new collaborative partnership with PayPal, JUST Capital, and the Good Jobs Institute to encourage the nation’s largest employers to prioritize employee financial health. This initiative, the Worker Financial Wellness Initiative, centers around a simple, yet often overlooked, idea: Measuring the financial health of employees matters.
There is no shortage of macro-level data showing that employees across the country, and in every industry, are struggling financially. This was true before COVID-19, and the economic impact of COVID has only exacerbated and underscored the many challenges workers face. Yet few organizations have taken the necessary steps to assess the financial health of their own workforces. Making the macro more personal is an important first step in helping an organization chart a path forward to improve the financial health of its entire workforce.
At the Financial Health Network, we believe that what gets measured gets managed. And helping organizations accurately and adequately measure employee financial health starts with appropriate and proven diagnostic tools and measurement approaches. As organizations think about assessing and improving the financial health of their workforces, here are some best practices to keep in mind:
- Use Proven Assessment Tools: Using the right assessment tool is critical for gaining insight into employee financial health. For example, the Financial Health Network’s FinHealth Score® is a survey tool that can help organizations assess the financial health of their employees. Additionally, integrating key HR data, such as retirement plan metrics, compensation assessments, and insurance coverage can help provide a more complete picture of the financial health of a given workforce. Starting even with limited amounts of data (in partnership with a survey) can go a long way toward helping an organization better understand the needs of its workforce. There are reliable and easy-to-use measurement tools available to help employers, including the FinHealth Score and the Good Jobs Institute’s suite of diagnostic tools.
- Aim To Solve the ‘Field of Dreams’ Fallacy: Just because you have a workplace financial health program does not mean employees will use it. Although the reasons why employee engagement may lag vary, too often employers seek to add new financial health solutions without fully understanding if those solutions meet the needs of their workforces. This is why assessment is such a critical first step. Having identified worker needs through an assessment, an employer can look to see where and if it can enhance existing benefits with evidence-based behavioral design. Additionally, with a keen understanding of worker needs, an employer is better positioned to identify gaps within its program and direct investments toward elevating existing programs (e.g., changes to compensation programs or core benefit design) or adding new programs (e.g., emergency savings, financial coaching, student loan solutions) to meet a previously undiagnosed need.
- Deploy Solutions with An Eye on Impact: In all likelihood, an employer will uncover a range of needs across its diverse workforce. Solving all of those needs in one fell swoop is unlikely as cost, feasibility, and ease of implementation will act as practical barriers. So, where should an employer start? We recommend that employers prioritize solutions that are likely to have the greatest impact on employees’ financial health, with an eye toward equity and addressing the most critical needs identified in the initial assessment.
Ultimately, organizations can use these best practices to create a repeatable, iterative process that allows them to adapt their financial health programs as their workforces and their related needs evolve.
Improving financial resilience does not happen overnight. This requires an ongoing commitment from C-suite and other business leaders within organizations. It starts, however, by assessing employee financial health.
To learn more about the tools and approaches to measure and improve workforce financial health, please contact Matt Bahl at the Financial Health Network at mbahl@finhealthnetwork.org or explore the Worker Financial Wellness Initiative.
