Employee Financial Literacy Blog

The Importance of Financial Education in the Workplace

Posted by Frank Wiginton on Fri, Apr 19, 2013

Don Stewart, former CEO of Sun Life Financial, speaks at the 2012 Financial Education in the Workplace Roundtable about why financial education in the workplace is important.

Transcript:

Donald: Financial literacy’s is an important topic for many reasons including the fact that where is getting a more complicated place, so it’s more difficult to make decisions, because there is more choice, there is more complexity and in some cases there is significant economic challenge out there. So to get it right for your financial economic situation is becoming increasingly challenging and it’s therefore important to know more about the basics, about your choices and why you should do certain things and stay away from other choices. Personally, I feel very strongly that workplace is an appropriate venue for financial training. It’s a place that many of us spend a great deal of time at. We have the resources of technology available at the workplace for many of us and the employer is in a position to provide education center around wanting the number of cases, a very comprehensive range of benefit and savings programs for employees.

To find out more about financial education in the workplace, read the recently published whitepaper,Financial Literacy for Employees: Understanding What Makes An Effective Financial Education Program.

Tags: financial wellness, employee financial education, corporate financial literacy

The Challenge for Businesses in Providing Financial Education

Posted by Frank Wiginton on Wed, Apr 17, 2013

Don Stewart, former CEO of Sun Life Financial, speaks at the 2012 Financial Education in the Workplace Roundtable about the competing initiatives that work against the widespread practice of financial literacy in the workplace.

Transcript:

Donald: What business in virtually every country face a great many challenges including importantly competing with each other and so financial literacy itself has to compete with  many other priorities, because obviously the first goal of the business is to thrive and prosper. And it’s only if financial literacy can be seen to contribute to that, that it’s able to get it, a place at the table and so competition for attention like any what while initiative is a fact of life. 

To find out more about financial education in the workplace, read the recently published whitepaper,Financial Literacy for Employees: Understanding What Makes An Effective Financial Education Program.

Tags: financial wellness, employee financial education, corporate financial literacy

How Financial Literacy can improve the health of your workforce

Posted by Frank Wiginton on Mon, Apr 15, 2013

When people discuss reasons to teach financial literacy, retirement savings and the dangers of debt often come up. What’s not talked about is the effect that being in debt or having no savings can have on someone; people who are having money problems are typically more stressed and less healthy than those who are financially secure.

Financial WellnessThere are several studies that point to a relationship between money and stress. A 2009 Desjardins Financial Security study, for instance, found that 61% of employees cite money problems as a leading cause of stress. 25% of workers found that debt is their main concern while 45% feel their level of financial stress today is high to overwhelming.

Another study, conducted by the Associated Press and AOL in 2008, found that people with high stress face a number of health-related issues. Here are some of the findings from that study:

  • 29% of people with debt-related stress suffered severe anxiety, compared to 4% who were stress free
  • 23% had severe depression, compared to 4%
  • 44% experienced migraines or other headaches, compared to 15%
  • 51% had muscle tension and back pain, compared to 31%

 

When people are sick they stay away from the office. A report from the U.K.-based Chartered Institute of Personnel and Development, found that employees are absent from work at least one week a year due to health reasons.

All of these illnesses and absences come at a great cost to employers. A 2005 academic study found that financial stress could cost companies up to $2000 per employee; that may be even higher these days.

When people become financially literate, their stress levels drop and, as a result, they become healthier and more productive.

With illnesses caused by financial stress costing companies so much money, it only makes sense for businesses to offer financial education in the workforce.

Through comprehensive financial education — via group sessions, one-on-one training, webinars and more — employees will be able to get a handle on their money issues and then come to work less stressed. When that happens, illnesses and absenteeism will fall and workers will become more productive. Not only will companies save money because more people will be at work, but they’ll also make money as those less stressed out workers become more engaged. 

To find out more about financial education in the workplace, read the recently published whitepaper,Financial Literacy for Employees: Understanding What Makes An Effective Financial Education Program.

Employee Financial Education White Paper

Tags: financial wellness, employee financial education, corporate financial literacy

The Three Benefits of Employee Financial Education

Posted by Frank Wiginton on Fri, Apr 12, 2013

Gary Rabbior, President of the Canadian Foundation for Economic Education (CFEE), speaks at the 2012 Financial Education in the Workplace Roundtable about the three benefits to employee financial education.

 

Transcription:

Gary: Well, there’s two, there is- I guess three different dimensions, it’s the benefits to the employees, who could certainly use in many cases to help on managing their financial affairs, everything from handling credit, to knowing what living within your means actually means, being able to plan for savings for kids education, your own retirement, taking of the financial stress that ultimately benefits them, but also in return benefits the employer.

And the fact that, if you can helped reduce the financial stress, the anxiety and hardships in people’s lives, the employers are going to benefit from decreased absenteeism, less risk of the crime in the workplace, people who are more productive, people are happier employees, people who are content in their lives are going to be better workers.

And then as a society, ultimately; we owe the number shows right now that we’re heading in the wrong direction. The direction that this isn’t sustainable, but largely is because people are struggling to get by, don’t know how to content with things and need guidance on how to better handle and manage their life affairs, so that we can stop the path their own and help people get more in control over their money affairs and their financial lives. 
I think part of the great advantage of financial education in the workplace is that they benefits do extend far beyond the employee themselves. And in fact, part of the problems you’re overcoming are open related to families stress and stress in the household that finding itself into the workplace and not only do you benefit that individual, not only do you benefit as an employer, but it reaches out and benefits family members, so there’s a lot of shared benefit that comes from this whole exercise.

Business people are commonly, for me with the multiplier effect with how things transcend beyond the individuals to help more collective outcomes and that would certainly be the case from their employees that would extend it at the family members and even beyond the immediate family members to others, because so many people are anxious for this kind of help and assistance and if some people get it and can share that with others, they’re going to find people anxious to participate.

To find out more about financial education in the workplace, read the recently published whitepaper,Financial Literacy for Employees: Understanding What Makes An Effective Financial Education Program.

Tags: financial wellness, employee financial education, corporate financial literacy

How to Fit Employee Financial Education into Business

Posted by Frank Wiginton on Wed, Apr 10, 2013

Gary Rabbior, President of the Canadian Foundation for Economic Education (CFEE), speaks at the 2012 Financial Education in the Workplace Roundtable about the challenges businesses face in prioritizing employee financial education in the workplace.


Transcription:

Gary Rabbior, President of the Canadian Foundation for Economic Education (CFEE), speaks at the 2012 Financial Education in the Workplace Roundtable about the challenges businesses face in prioritizing employee financial education in the workplace.
Gary: I think most of the challenges that an employer would probably initially have is just the concept of how you fit it in. Business to business is business and that’s what business does. There is a business case to make for why financial literacy or financial education should be in the workplace and I think businesses are increasingly recognizing that.
Once, they accept the fact that maybe it’s a good thing to do both for their own benefit and for the benefit of their employees, the initial reaction will be, “How am I going to make this work?” And there are ways to make it work, it has two very different ways, different workplaces, different times, but I would say the biggest barrier isn’t the desire to do it, they see good in it. It’s how do I fit this in into our business?
Fitting financial education into a business is extraordinary variant. Do you have manufacturing companies, you have service companies, you have companies who are placed on the road, companies, who are employees are on shifts. There is- it is the last of the one size fits all content. It is going to be different in every company depending on the circumstances, the timing that’s available, the period of time on which the program could be run. There are so many variables, but that shouldn’t preclude it for being done. What companies recognizes is that, there’s no set ways to do it, so you’re adapted to your circumstance, set it up the way it works, what’s best for you and your employees.

To find out more about financial education in the workplace, read the recently published whitepaper,Financial Literacy for Employees: Understanding What Makes An Effective Financial Education Program.

Financial Education White Paper Series

Tags: financial wellness, employee financial education, corporate financial literacy

Why financial education in the workplace matters?

Posted by Frank Wiginton on Mon, Apr 08, 2013

Many companies are starting to find out that it’s up to them to offer financial education. While employees can get this training on their own — by talking to a financial advisor or attending seminars — the reality is that many don’t make the time to do this themselves.

Employee Financial EducationEmployees are also unsure of where to turn. A Proformative Inc. survey found that 74% of people don’t know which sources of financial information are trustworthy. When Canadians don’t know where to turn, they don’t get advice. According to our Financial Education in the Workplace survey, 51% of people haven’t sought financial advice in the last two years, while a Metlife report found just 33% of employees say they are in control of their finances.

Comprehensive financial education, though, does work. The Promformative report discovered that when employees receive financial education that matters to them, they’re 60% more likely to implement that advice than people who receive broad financial information.

So what do these statistics tell us? If employers leave it up their staff to seek out advice, they won’t get the help they need. Companies, then, need to step in and offer that financial advice. As we’ve written earlier (LINK TO OTHER BLOG POSTS) reduced stress has numerous work-related benefits, so improving the financial health of your workforce is good for your company. 

It also helps that employees want their employer to offer financial education. We found that 87% of employees want financial education, 47% want employers advice around benefits, while 49% want education around retirement savings.

Of course, education can’t just center around pensions, benefits and retirement. The training needs to be comprehensive and cover everything from debt management and RRSP investing to education savings and tax planning.

If employees aren’t seeking out financial advice on their own, then it’s up to you, the employer, to provide it. Fortunately, it’s good for business. Numerous studies have shown that having a financially-literate workforce can help companies save money and grow their bottom line. 

To find out more about financial education in the workplace, read the recently published whitepaper,Financial Literacy for Employees: Understanding What Makes An Effective Financial Education Program.

Financial Education White Paper Series

Tags: financial wellness, employee financial education, corporate financial literacy

Educating Your Employees on Personal Finance

Posted by Frank Wiginton on Fri, Apr 05, 2013

Gary Rabbior, President of the Canadian Foundation for Economic Education (CFEE), speaks at the 2012 Financial Education in the Workplace Roundtable about the most "underutilized learning environments" for financial education; the workplace.

Transcription:

Gary Rabbior: I think there’s two questions in one. One, why is financial education important? It’s important, because it becomes so relevant in people’s lives. Financial matters had become complex and people have never been taught the skills or knowledge to be able to make those kinds of decisions confidently and effectively. And in the workplace, because it’s the untapped area for learning that we have available to us. Right now, it’s probably one of the most under utilize learning environment. It’s a challenging one to get into, but if we can get into it, there are so much good that can be done there with people who want to know and people could benefit from what could be offered. 

To find out more about financial education in the workplace, read the recently published whitepaper,Financial Literacy for Employees: Understanding What Makes An Effective Financial Education Program.

Employee Financial Education White Paper

Tags: financial wellness, employee financial education, corporate financial literacy

The Importance of Financial Education in the Workplace

Posted by Frank Wiginton on Wed, Apr 03, 2013

Jane Rooney, Director of Financial Literacy and Consumer Education at the Financial Consumer Agency of Canada (FCAC), speaks at the 2012 Financial Education in the Workplace Roundtable about the importance of financial education for employees.

 

Transcription:

Jane Rooney: It’s important for financial literacy and financial education to happen in the workplace, because employees are exposed to a lot of benefit programs and they have to understand what those are. The workplace is an opportunity for a very broad base of consumers to get the same information from their employers, so I think it’s really great place to have education.

To find out more about financial education in the workplace, read the recently published whitepaper,Financial Literacy for Employees: Understanding What Makes An Effective Financial Education Program. 

Tags: financial wellness, employee financial education, corporate financial literacy

Why aren’t more companies offering financial education?

Posted by Frank Wiginton on Mon, Apr 01, 2013

No matter how you look at it, financial education in the workplace makes a lot of sense. The less financially stressed people become, the more engaged and productive they are at the office. Yet, many companies don’t offer financial education to their employees.

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 We asked companies that do not provide financial education in the workplace if they plan on offering it in the future. An incredible 94% said “no.”

Why such a high number? It turns out that many of them have never thought about offering financial education, while others have never asked employees if they want it.

Cost of the program
The most popular reason as to why executives don’t offer financial education is because they think the cost of the program is too high. About 50% of those surveyed citied this as the main barrier to providing education. It does cost some money to administer a financial literacy program, but the benefits far outweigh the costs. If employees are more engaged, their work will contribute more to the bottom line. As well, financial stress can cost about $2000 per employee per year; add that up across all of your stressed-out staff and you’ll see that you’ll save far more than you’ll spend.

Giving time off for education
Another major reason why companies don’t offer financial education in the workplace is that they don’t want to give their employees time off to attend. Nearly 35% of respondents cited this as a reason to not offer education. That’s understandable — a lot has to get done at the office. But what many executives don’t realize is that a financially-stressed workforce isn’t as engaged or as productive as a financially-empowered staff. In other words, many employees may not be doing their job to their full capacity anyway. If you can reduce their personal financial stress, then you’ll create a more efficient workforce both in the short-term and for years to come.

Expectation of low participation
About 28% of companies said that they don’t offer financial education because they assume no one will be interested. That’s simply not true. Around 87% of employees have said they want financial education in the workplace. They key is finding out what employees want to talk about and when they want that education delivered. This can be done via a survey conducted by the third-party educator. Find out what staff wants to discuss and when and where they want the sessions to take place and there’s no reason participation should be low.

Don’t understand what’s available
Nearly 28% of employers fail to provide financial education because they just don’t know what it’s all about. They don’t understand what type of topics will be discussed, the various ways education can be delivered and how a financial literacy program works. Fortunately, that’s an easy fix. Financial educators have plenty of experience talking to executives about the benefits of a financial literacy program and can help people get a handle around what a course entails. Pick up the phone and ask a third-party financial educator what their program is all about.

An independent third-party financial educator can help alleviate these concerns. Ask an educator about how financial training can help your employees and you’ll see that these issues are no reason to avoid this type of education.

To find out more about financial education in the workplace, read the recently published whitepaper,Financial Literacy for Employees: Understanding What Makes An Effective Financial Education Program.

Tags: financial wellness, employee financial education, corporate financial literacy

The Basics of Financial Education in the Workplace

Posted by Frank Wiginton on Fri, Mar 29, 2013

Jane Rooney, Director of Financial Literacy and Consumer Education at the Financial Consumer Agency of Canada (FCAC), speaks at the 2012 Financial Education in the Workplace Roundtable about teaching employees the basics of money management.

Transcription:

Jane: A lot of times we talk about retirement planning, because that’s very important. You have to start saving young, at an early age and you save over the long term, so that you can become comfortable in retirement, because as we know social benefit programs are changing and we know that people are going to have to supplement their income in retirement with their own savings. So retirement is a key focus, but there are a lot of other areas that you need to be aware of.

Very basics what’s a need versus a want, how do you budget. In order to save, you have to be able to budget. Make a budget, so that you know what your expenses are, you know what your income is and you can identify where are those savings can come from. Savings levels are very low rate now and debt levels are very high. So again, another key message that I think is important in financial literacy is how to manage your debt. So it’s- it’s very, very broad beyond retirement.

Income, expenses, budgeting, managing your credit, managing your debt wisely, pay down debt so that you can free up some money in the long term to help supplement your retirement savings.

To find out more about financial education in the workplace, read the recently published whitepaper,Financial Literacy for Employees: Understanding What Makes An Effective Financial Education Program.

Tags: financial wellness, employee financial education, corporate financial literacy