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How Financial Wellness Affects Employee Health

Employers and Organizations

The HR Guide to Reducing Employee Stress

hr managers discussing employee stress

Last Update: April 4, 2022

When asked to provide a list of things that stressed them out, half of the top ten1 reasons employees provided were financial – including their overall financial situation, saving for the future, paying off their debt, maintaining a budget, and investing their money. 

A Fidelity survey2 found that financially stressed employees are ten times as likely to be dissatisfied with their job as someone without financial stress. 

And we know that employees are experiencing financial stress.

Before the pandemic, one report3 found that three out of five employees did not feel financially well. Since that time, another report4 found that 63% of employees now say their financial stress is even worse. 

Employee benefits managers agree, noting the following signs of stress in the workplace:

  • Increase in hardship loans
  • Increase in payday loans
  • More wage garnishments
  • Under-utilization of 401(k) match
  • Under-utilization of other employee benefits
  • Increase in sick days
  • Increased employee turnover

Financially stressed employees are neither healthy nor productive – two factors that affect your company’s bottom line

Financial Stress and Health

Between 75 percent and 90 percent of all visits to primary care doctors are due to stress-related medical issues5, likely due to poor habits associated with stress.

The Fidelity study found that financially stressed employees are two times less likely to:

  • Get enough sleep
  • Exercise regularly
  • Get a flu shot
  • Regularly eat healthy meals
  • Go to the doctor and dentist
  • Maintain a healthy weight
  • Avoid tobacco use

When employees are in poor health, they cost their employers money

Financial Stress and Productivity

In addition to medical issues, financial stress leads to productivity issues.

Thirty-five percent of employees are distracted at work due to finances. And of those distracted, half spent three or more hours each week handling financial matters while at work6.

Plus, employees with the highest debt levels are twice as likely to miss work as those with the lowest debt level.

Financially stressed employees lose 23 to 31 days of productive work per year and are 2.2 times more likely to look for a new job.

An Integrated Benefits Institute report7 found that employee stress cost US employers $575 billion a year in worker absences, chronic medical conditions, injuries, lost productivity, and employee turnover.

Financial Stress Can Be Fixed

Thankfully, financial stress does not have to be a permanent problem, and employers have the means to help their employees achieve financial wellness through appropriate financial benefits.

Internal data from Enrich shows that, over time, users of the program reduce their financial stress by an average of 23% over 12 months.

decrease in financial stress for enrich users over time

Here’s how to get started.

#1: Start with Surveys

There is no “one-size-fits-all” solution for helping employees reduce financial stress because it varies by personality and demographics.

That’s why employers should start with a survey to find out what stresses employees and then ensure that the financial wellness benefits offered address these issues. 

Enrich has found that the most common financial stressors are:

most common financial stressors

In addition to finding financial wellness solutions that meet employee needs, it makes sense to find personalized solutions that meet each employee where they are and help them with their specific issues.

#2: Start with Small Steps

Employers need to recognize that financial wellness is a process that takes time.

Employees will not achieve this state overnight and must be guided toward the goal using small steps.

Many benefits managers try to fix the problem too quickly by attempting workshops, audits, retirement readiness programs, or consultations with a certified planner.

While these are not bad ideas, they are not the place to start.

Employees are more likely to become involved with financial wellness benefits if the first steps are simple. For instance:

  • Taking a survey
  • Watching a video
  • Filling out a budget worksheet
  • Completing a checkup assessment

Here are some best practices for launching a successful financial wellness program.

#3: Facilitate Savings

Enrich has found that employees without an emergency fund experience more financial stress than employees with one.

impact of emergency fund on financial stress

This suggests that benefits that help employees create and maintain an emergency savings account can substantially help with financial stress. 

Benefits to consider include:

  • Sidecar savings accounts
  • 529 payroll deduction/matching
  • Budgeting
  • Direct deposit split

#4: One-on-One Interaction

A recent white paper8 found that 84% of employees feel that financial advice is a valuable benefit, with three out of four saying it would reduce their financial stress.

Offering financial counseling also helps employees feel better about their employment, with over half saying they would be more likely to stay with an employer who offered these benefits. 

One-on-one interaction can be achieved through counselors, advisors, or coaches in the following ways:

  • Onsite
  • Telephone
  • Live chat


1 - https://www.benefitspro.com/2019/03/25/businesses-lose-half-a-billion-dollars-a-year-due-to-employee-financial-stress/ 

2 - https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/press-release/Fidelity-Well-Being-Survey-041819.pdf 

3 - https://www.enrich.org/financial-wellness-resources/2020-employee-financial-wellness-report

4 - https://www.pwc.com/us/en/services/consulting/workforce-of-the-future/library/employee-financial-wellness-survey.html 

5 - https://jamanetwork.com/journals/jamainternalmedicine/fullarticle/1392494 

6 - https://www.benefitspro.com/2019/03/25/businesses-lose-half-a-billion-dollars-a-year-due-to-employee-financial-stress/ 

7 - https://www.ibiweb.org/poor-health-costs-us-employers-530-billion-and-1-4-billion-work-days-of-absence-and-impaired-performance/# 

8 - “Closing the Financial Advice Gap”, Edelman Financial Engines white paper, 2019 


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