In search of ROI
The benefits of financial wellness programs are well documented, but organizations want metrics and measurements to validate the expense. Among our survey respondents, of those who do not have a program, only 16% felt they could justify adding a financial wellness program without knowing the anticipated ROI. Among those who already offer some type of benefit, 34% felt they could offer the benefit without knowing the ROI.
But ROI can be difficult to measure and may not be the most reliable benchmark. Sick days, productivity and other indicators fluctuate, and factors unrelated to financial stress could account for those changes. Additional data may be with third parties, making it expensive to obtain and time consuming to aggregate.
The reality is that financial wellness programs can be “proved in” with fairly conservative assumptions. The Consumer Financial Protection Bureau says employers typically see a return of $3 for every $1 spent on financial wellness programs. Yet a more effective way to prove the program’s value is by measuring employee engagement.
It’s time to change the ROI conversation. HR practitioners excel at knowing how employees utilize their benefits options, accepted methods of learning more about an organizational topic and what employees look for when they need help. This practical knowledge provides an opportunity for the benefits department to share strategic insights with the C-suite, helping executives reframe how they view the value of financial wellness programs.
Participation = ROI
- It’s understandable that organizations need to measure the impact of their investment in employee benefits. Creating a suite of benefits is futile if your workforce doesn’t use the resources to forge a path to financial wellness. But changing the conversation from metrics-driven assessment to measuring levels of healthy utilization will give leaders a new perspective on the value of their spend.
- Financial wellness is a lifelong effort. The more guidance your employees receive, the more likely they are to learn and put financial constructs into action. Targeted education, access to personalized learning paths and support from trained financial professionals ultimately lead to employees who are engaged in their financial lives.
- As employees become more active in financial planning, they build the confidence they need to continue their financial wellness journey. Alleviating financial stress clears the way for more productive workers and ultimately yields a higher return on investment.