Are your employees stressed about their finances? Do they understand saving money or living within a budget?
Many young employees, or Millennials, tend to share similar financial issues such as credit card debt, difficulty saving, managing basic living expenses, paying for the lifestyle they want (i.e. bars, vacations, etc.), and let’s not forget paying off those student loans. These financial issues can impact an employee’s attitude, stress levels, and overall health. No one wants want to stress about money!
The words finances, earnings, savings, health benefits, employee benefits, 401K, and investingcan overwhelm even the most financially savvy adult, let alone a younger, more inexperienced person. They may also be intimidated by their lack of understanding of finances and are unwilling to admit it as they are so successful and brilliant in many other areas (as most Power Digital team members are).
Too often, these employees make decisions about their health benefits, 401K, savings plans and other offered benefits without fully understanding anything about them. They are reading and blindly checking boxes to make the required decisions during open enrollment but not truly understanding the ramifications that come with their decisions.
As the person in charge of our company’s finances, I realize that I (like every other business owner) have the ability to help our employees understand their finances, to help them make informed decisions, and to help them improve their financial well-being by offering financial education.
When employers take the time to educate their employees about finance, the benefits they are offered, money management, and investment decisions, everyone thrives.
Related: Tips for Managing Millennials in the Workplace
Below are a few tips to help your younger team understand finances:
Budgets
I think most people will agree that everyone should have a budget. However even knowing that, most people don’t act on it. Below are a couple of resources that can help put a budget together and more importantly, help you stick to it!
- You Need a Budget makes it easy for anyone who has never had a budget to create one and get started. At a small fee of $50 per year (Which I promise you will save in the long run), makes learning how to budget and sticking with a budget something anyone can achieve.
- Mint helps take care of your finances all in one place. Imagine an accounting software made easy for anyone to use it. The best part? It’s FREE! Mint will let you know where you stand in terms of savings, what you are spending, where you are spending, and how you can improve.
- Level Money is a personal assistant for your finances. They offer a free initial consultation followed by a monthly fee and a fee for financial reviews. It saves you time and ultimately money. This is another great resource for people trying to get a great grasp on their finances.
Consultations
There’s many ways to provide ongoing employee education to help them understand and practice money management and to invest in their future financial well being. For us at Power Digital, we have a Soap Box series where we bring in industry professionals to answer any questions our team may have regarding that topic. A few of these industry experts and example topics include:
- Loan Officer – What mortgage rates are available?
- Real Estate Agents – Buying vs. Renting
- Financial Advisors – 401k and retirement plans
- CPA – Taxes and best practices
Most banks, 401K management companies, real estate agents, and financial advisors are more than happy to provide a free advice as it a great way for them to get in front of potential new clients. It’s a win-win for everyone!
Money Management
This can be a very broad term, and depending on your employees’ specific needs, you may want to provide education covering content such as saving for the future, saving for an emergency fund (i.e. Car breaks down or unforeseen bills), investment, taxes, and of course paying off loans and credit card usage.
Employer Offered Benefits
At Power Digital, we offer a wide range of benefits including Health, Dental, 401k, and many others. The key is insuring that your team fully understands and takes advantage of these benefits. Employees who understand the benefits available to them and utilize these benefits are going to appreciate their employer much more!
Related: Why You Should Give Your Employees Unlimited PTO
They understand you care about their long-term well-being. Some people know health insurance is provided and that they can contribute to a 401K. But are they participating? Do they understand the importance of saving for a post-work life and the importance of preventative care at their young age? For us, we monitor who is and who isn’t participating and bring it up during employee meetings, reminding them of the benefits!
Money Conversations
Through continued education and consultation, you create an environment where questions about money or finances is not only welcomed, but encouraged! After all, no one wants to be afraid or feel too stupid to ask an important financial question. This can help employees share what works and what doesn’t work with setting and maintaining their budgets as well as what resources they use to stay on track.
By taking the extra step and investing in your employees with a financial education, you will be giving them a life skill which is under-taught and so important to every aspect of living.
Employees will always be responsible for their own decisions, actions, responses, and reactions and hopefully by having a better understanding of finances, they can eliminate financial issues in their lives, which impact the overall success of the organization. Happy financing!
