The Proof is in: Financial Education at Work is a Key Benefit
By Kevin Mercadante
May 2, 2017
The proof is in: employers who offer financial education at work have the least stressed and most productive workers.
About two-thirds of employers provide financial education, according to a study from the International Foundation of Employee Benefit Plans. Of those, two-thirds say it is successful.
The best results come in the area of investing, where 73% of employers that offer financial education say it improves their workers’ investing skills. Other areas where employers see results are in saving, where 70% say financial education is successful; insurance (47%); budgeting (43%); and smart spending (33%).
Drilling down to more specific topics, the study found financial education was most successful in understanding retirement plan benefits (77% of employers say that is the case). Other specific areas of success include pre-retirement financial planning (61%); investment management and asset allocation (57%); and retirement plan distributions (54%).
Overall, employers that offer financial education say just 39% of their employees are “not at all or only a little bit financially savvy.” That compares to 62% of the employers that d not offer financial education.
A similar gulf exists in retirement planning, where only 29% of employers providing financial education rate their employees as “not at all or only a little prepared to retire” compared to 43% of firms that do not offer financial education, according to the study.
The most successful method of delivering financial education is through classes and workshops. Some 91% of employers offering this support report success using these methods. Another key to success: 79% of companies say offering financial education during the regular workday works best. One-on-one meetings are seen as twice as successful as group meetings.
Of employers offering financial education, 49% say it is most successful when provided for a period of 10 years or longer, compared to just 5% that say it is successful after one or two years.
The findings are consistent with other surveys. A PwC 2017 Employee Financial Wellness Survey found that nearly one in three employees reports that issues with personal finance are a distraction at work. In general, a stressed worker is an unproductive worker, and a leading cause of stress is money. That’s why employers increasingly offer financial education.