Employees are more concerned than ever when it comes to their financial security as a result of the continuing coronavirus pandemic, which has caused mass layoffs and an unemployment rate of more than 10%.
The crisis has caused an awakening among workers who now recognize the need to manage their finances differently moving forward. Employers play a key role in providing the right education and tools to do so.
“The COVID-19 pandemic [has exposed] what we already knew in terms of employees’ financial unpreparedness,” says Jessica Gillespie, senior vice president and head of distribution at Prudential. “It's highlighted issues including a lack of emergency savings, not having enough life insurance protection and not having sufficient health care.”
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In an effort to combat this financial insecurity, Prudential Financial has created a new benefit that packages financial wellness content, online tools, and virtual and in-person programs to provide the educational foundation employees need to manage day-to-day finances, safeguard against financial disruptions, and develop a plan for meeting specific financial goals. The package also includes seminars tailored to address key obstacles faced during the pandemic and timely education and assistance for employees. Workplace benefits are integrated to teach employees how they can optimally use them for their specific financial situation.
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The benefit “creates a foundation for new financial behavior,” Gillespie says. The program will help employees establish credit and budgeting habits, set up an emergency fund, and plan for long-term goals like investment allocation and estate planning.
More than half of Americans' financial health has been negatively impacted either directly or indirectly by the effects of the pandemic, according to Prudential data. As such, employers are seeing a rise in the value of equipping their workforce with the tools to help protect and prepare them within their financial lives. However, human resources teams are consumed by pandemic-related business challenges and are unable to spend time educating employees on basic financial education when they need it most.
“What is very appealing to the employer is, whether they're a Prudential customer or not, we're there to supplement their existing benefit plans and we really go in and leverage what they're trying to drive with their employee,” Gillespie says. “We advocate for the usage of the benefits and the right benefits collection, we take all of that into consideration and we put it into the program.”
Even before the pandemic took hold, employers were increasingly recognizing the importance of offering financial wellness benefits. Not only are they strong attraction and retention tools, but they help create a more well-rounded and stress-free employee, thus improving productivity rates.
While traditional financial benefits have typically included retirement savings programs, employers are recognizing the need to provide a broader range of programs and offerings to build financial acumen, especially during these uncharted times.
“Traditionally, financial wellness programs are more a la carte and customizable, which is the best approach in normal circumstances, but they can be time-intensive to design and implement, which poses challenges for employers to act in the current environment,” Julie Brandon, vice president and head of financial wellness distribution at Prudential, said in a statement. “Prudential has identified a mix of resources and tools that we know will help employees to protect and enhance their financial wellbeing, regardless of different industry and demographic considerations, making it much easier for employers to implement.”
