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Why Financial Wellness is Important

“There’s no question that workplace wellness is worth it. The only question is whether you’re going to do it today or tomorrow. If you keep saying you’re going to do it tomorrow, you’ll never do it. You have to get on it today.”

-Warren Buffet, Chairman, Berkshire Hathaway

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The Problem

  • A financially stressed employee spends an average of 20 hours per month of work time on their financial problems (Kansas City Federal Reserve)
  • Unprecedented debt and lack of savings among Americans
  • Those who earn a high salary but do not manage it well are no better off than those who earn lower wages.
  • One in four U.S. households does not have enough saved to support itself, even at the poverty line, for three months. Corporation for Enterprise Development 2005 Assets and Opportunity Scorecard
  • Financial problems lead to lower productivity and lower morale for employees. Many see their employer as the cause of their financial problems – they “don’t get paid enough.”
  • 15-20% of employees have financial problems severe enough to affect productivity (Kansas City Federal Reserve)
  • A financially stressed employee spends an average of 20 hours per month of work time on his/her financial problems (Kansas City Federal Reserve)

Potential Strategies

  • Financial Literacy is a national priority. In 2008, President Bush signed an Executive Order that established the President’s Advisory Council on Financial Literacy.
  • Federal Reserve Chairman Ben Bernanke said, “I am personally convinced that improving education is vital to the future of our economy and all its citizens, and I strongly believe that promoting financial literacy, in particular, must be a high priority.
  • Awareness, education, and behavior change through classes, personalized financial plans, and ongoing counseling lead to hope when employees discover ways to pursue their goals.
  • The Waddell & Reed Financial Wellness Program provides classes and 1:1 meetings with employees, creating a personalized financial plan for every participant. Employees are encouraged to bring their spouses to the training and are required to bring them to the 1:1 meetings.

The Potential Benefits

The Waddell & Reed Financial Wellness Program attempts to foster goodwill and provides a tangible benefit for employees and employers.

  • Increased participation in the company retirement plan
  • Enhanced company culture
  • Potential reduction in employee turnover thereby reducing the costs associated with turnover
  • Reduce absenteeism – direct correlation between absenteeism and financial instability. Lower absenteeism can lead to higher productivity