Financial Wellness Benefits Key to Employee Retention

Most financial executives believe that employee benefits packages focusing on financial wellness are key drivers of success for their companies, according to a recent survey by CFO research and Prudential.

The study found that more than half of executives or 82% believe their company will benefit from having a financially secure workforce. Only 5% said they don’t believe so, and 13% said they were not sure. Most executives view financial wellness as a key component of corporate performance, as well as an effective human resource-management strategy.

“It is encouraging to see that employers are seeing the value in helping employees focus on financial wellness,” says Jim Gemus, senior vice president, distribution and product management, Prudential Group Insurance. “In particular, employers seem ready to look at ways to not only measure the financial wellness of their employees, but also to benchmark it against other companies in their industry. This survey demonstrates that the vast majority of employers recognize that improving the financial wellness of their workforce yields significant benefits for their companies and employees alike.”

More than six in ten respondents (63%) say that employee satisfaction with benefits is important for their company’s success, and 65% believe that employee benefits are critical to attracting and retaining employees. Even if the deductibility of employer-sponsored benefits were to be removed, several respondents (29%) said their companies would either continue to offer the same package with the same subsidies or increase employee compensation to counterbalance reduced corporate subsidies (28%).

Most (78%) also said that employers should assist employees in achieving financial wellness during their working years. Only 8% disagreed and 14% were not sure. Even more (84%) say that it is important to ensure that their companies’ employees are educated on key tenets of financial wellness.

Finance executives consider higher employee satisfaction (59%) and increased retention (53%) as the most important benefits coming out of a focus on financial wellness.

Seventy-percent agree that it is important for their companies to measure employees’ financial wellness. About the same number (71%) agree that benchmarking their employees’ financial wellness versus other companies is an added source of value.

These findings are from the sixth annual survey of the benefits landscape conducted by CFO Research and Prudential. This year’s results are based on survey of responses of 180 finance executives, most of whom (78%) work at large U.S. companies with more than $1 billion in annual revenues.

More information on the survey can be found at Prudential.com.