financial wellness programs

7 Surprising Facts About Financial Wellness Programs

Why should companies try to improve their employee’s well-being?  How can financial wellness programs improve employee morale, lower stress levels and increase engagement? Do employees even want these programs?

Financial planning technology vendor Advizr invited me to attend the first in a series of events to encourage an open dialogue among human resources professionals about financial wellness in the workplace.  As someone who attends 10-12 conferences annually, I find these smaller, more-focused gathers generate outcomes that are more insightful than conventional halls full of people.

Afterwards, I was able to sit down with Advizr CEO Hussain Zaidi to get his thoughts on some of the important issues raised during the discussion.

It’s Complicated!

There are so many factors that companies must deal with when designing and delivering their financial wellness programs.

HZ: What also complicates the issue are the different types of vendors in the financial wellness arena. We have heard from human resources professionals that they have to manage too many technology platforms and programs. Constantly switching between apps and websites is not productive and makes it difficult to present a coherent message to employees. This creates a substantial opportunity for a well-thought out offering, like ours.

Different Demographics – Different Needs

It’s true that financial wellness requirements differ widely by age group.


HZ: The differences are not only generational, but also at the net worth level. Companies need to bring together different components by designing an organized program combining technology, education, support and connectivity to actions taken.

financial planning


The conventional wisdom is that Millennials opt out of 401(k) auto-enrollment at a higher rate than older employees. The data shows otherwise.

HZ: Research shows that employees save more when auto-enrolled in their company’s retirement plan.  Since 2005, companies providing an auto-enrollment retirement plan for their employees has risen from 19% to 56%.

Behavioral psychology shows that people don’t feel the pain of automatic withdrawals of low percentages. They only feel it when they make a conscious decision to spend.  Firms must systematize as much of the actions as possible: increasing contribution, setting up Healthcare Savings Accounts, etc. It’s important to establish the right habits when employees are hired, since it is much more difficult to change them afterwards.

Debt vs Savings

How can younger employees be expected to understand how directing money from their retirement accounts to pay off school loans might not be in their best financial interest?

HZ: Student loans are debilitating mentally, but an education and planning process is critical to raise awareness of the trade-offs between paying off debt and contributing to savings.

Traditional financial services were built to cater to high net worth (HNW) client segments, not white collar employees. This requires a new wealth management program, mindset and business model.

Word of Mouth

Benefits can make up from 30% to 44% of the average employee’s compensation. So why don’t companies do a better job of communicating the program details to their employees?

HZ: This reliance on word of mouth reflects an inherent inefficiency in benefit communication programs. A portion of this is about asking employees, “Where is your free money?”  It’s in the company match, reimbursement for commuting costs, etc. A gasified mobile app would do a better job of communicating free money and other benefit opportunities.

Higher Engagement = Higher Retention

HZ: Besides being the right thing to do, improving employee engagement also reduces stress to help employees avoid worrying about their finances. More engaged employees have higher productivity (avoiding presenteeism) and better performance. Leaders should look to financial wellness programs as one component of an overall plan to improve their business wellness programs


It’s often an uphill battle for human resources and benefits managers to explain the return on investment (ROI) from financial wellness.

There’s no clear framework for HR to help educate the business. The Advizr WorkPlace system includes an employer dashboard to help management better understand employee engagement with the platform and the underlying ROI.  A lot of the data is based on the results of regular financial assessment surveys. The system calculates ROI based on the number of employees that are not financially well and converts that into an estimate of the number of hours of lost productivity.

Some HR people feel they need to be more creating when trying to justify their wellness budgets. It’s not as much about creativity as it is having the numbers to back up the benefits received.

HZ: it’s more expensive if a senior employee doesn’t retire by age 65. Higher salary and could be less productive. Planning helps employees reach their goals.




The Wealth Tech Today blog is published by Craig Iskowitz, founder and CEO of Ezra Group, a boutique consulting firm that caters to banks, broker-dealers, RIA’s, asset managers and the leading vendors in the surrounding #fintech space. He can be reached at