How Financial Wellness Drives Employee Engagement

Employee engagement is one of the most critical drivers of business success, yet many HR leaders overlook a key factor that significantly impacts engagement: financial wellness. 

Money exerts influence over all aspects of your employees’ lives, including how they feel about their job, and ultimately, company-wide productivity as well. With 63% of employees saying financial stress affects their focus at work, companies that invest in comprehensive financial wellness programs see higher retention, improved productivity, and better benefits utilization.

This article explores how financial wellness impacts engagement and provides actionable strategies HR teams can implement today.

Why Financial Wellness Impacts Employee Engagement

• Financial stress reduces productivity: Employees who struggle financially are 5x more likely to be distracted at work.

• Engaged employees stay longer: Companies with financial wellness programs see 20% higher retention rates.

• Financially secure employees use benefits more effectively: Employees who receive financial education are 2x more likely to engage with 401(k)s, HSAs, and other benefits.

The bottom line? Employees who feel financially secure are happier, more productive, and more engaged at work.

The 3 Ways Financial Wellness Improves Engagement

1. Reduces Workplace Stress & Increases Focus

• Employees worried about money spend 3+ hours per week dealing with financial issues on company time.

• A financial wellness program helps employees take control of their finances, reducing stress and improving focus.

Success Story: A healthcare company offering financial coaching and budgeting tools saw a 30% decrease in absenteeism and a boost in employee satisfaction scores

2. Strengthens Retention & Job Satisfaction

• Financially stable employees are less likely to job-hop.

• Companies that provide holistic financial benefits (estate planning, tax optimization, and investing guidance) retain more high-performing employees.

Success Story: A tech firm that implemented equity compensation and investment education saw a 20% increase in employee tenure.

3. Boosts Benefits Utilization & ROI

• Many employees don’t engage with their benefits because they don’t understand them.

• Financial wellness programs help employees maximize their total compensation, leading to increased 401(k) contributions, HSA/FSA participation, and long-term wealth-building.

Success Story: A company that embedded financial wellness into open enrollment education saw a 40% increase in 401(k) and HSA participation.

How HR Teams Can Implement Financial Wellness for Higher Engagement

1. Provide Personalized Financial Planning & Education

• Offer on-demand financial tools for budgeting, investing, and tax planning.

• Give employees access to 1:1 financial planning tailored to their goals—real advice and real guidance from Certified Financial Planners®, not just financial coaches.

2. Align Financial Wellness with Total Rewards & Benefits

• Simplify 401(k), HSA, and FSA education to ensure employees understand how to maximize benefits.

• Provide estate planning and tax-saving strategies as part of financial education initiatives.

3. Incentivize Participation & Measure Impact

• Offer incentives for employees who complete financial literacy programs

• Track engagement and retention rates before and after program rollout.

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