6 Ways To Make The Most Of Your Workplace Financial Wellness Benefit

As an unbiased financial wellness coach, one of my personal missions is to help people realize that much of what they need to make the most of their finances is available through work by using their financial wellness benefit. Many of the employees I talk with via the Financial Helpline aren’t even aware of the full suite of benefits they have. Even if you don’t work for a company that offers our programs, chances are you have some type of benefit that can help.

What can you do with a workplace financial wellness benefit? A lot – and it doesn’t cost you a dime to get help tackling your debt, getting ready to buy your first home, running a retirement projection or understanding the difference between a Roth and Traditional 401(k). You may have access to a wide range of resources, including financial coaching, workshops, webcasts, peer-to-peer groups and online learning tools, all paid for by your employer.

Even just using your benefit may put you in better financial shape

What’s the upside of participating over time? Our research found that those employees who were repeat users of their workplace financial wellness programs had higher overall financial wellness, were better prepared for retirement, managed their cash flow more effectively and were more comfortable with their debt levels. Here’s a summary of the progress participants made between taking their first financial wellness assessment and their most recent one:

1st assessment Last assessment
I have a handle on my cash flow. 67% 77%
I have an emergency fund to cover unexpected expenses. 51% 59%
I check my credit report on an annual basis. 54% 71%
I am on track to reach my income goal in retirement. 18% 39%
I feel confident that my investments are allocated appropriately. 31% 51%
I have taken an investment risk tolerance assessment. 43% 65%
I rebalance my investment accounts to keep my asset allocation plans on track. 33% 58%
I carry enough life insurance to replace my income. 46% 60%
Average overall Financial Wellness score 4.85 5.96

6 ways you can take advantage of the benefit

1. Find a financial mentor

Navigating financial issues has become increasingly challenging, with employees facing more and more complex decisions about health insurance, tackling debt and student loans, saving for retirement and balancing competing priorities. A workplace financial wellness coach can help guide you through all that “life stuff,” helping you understand your options, weigh the pros and cons of each and assess the impact on your financial trajectory.

Depending on your company’s financial wellness program, you may be able to talk to someone on the phone and/or in person. That coach becomes your financial mentor – someone to cut through all the jargon and help you clarify the actions needed to move you towards your most important goals.

Mentoring from a financial coach is different from advice. A financial mentor empowers you to make wiser, more confident financial decisions for yourself. Questions to ask your financial coach/mentor include:

  • Can I speak to you on the telephone, in person, or both?
  • Can I email you my questions?
  • Is there any limit to how many times we can work together?
  • Do you have a professional designation, such as the CERTIFIED FINANCIAL PLANNER™ designation or CPA credential?
  • Is this completely unbiased with no sales pitch?

Heads up: make sure that your financial coach is truly unbiased and isn’t just trying to use the phrase “financial wellness” to sell you investments, insurance or anything else. A real financial wellness program won’t sell you anything.

2. Grab a life line

If you are living paycheck to paycheck or feeling overwhelmed by bills, your financial wellness program can help. Debt and cash flow issues are primary drivers of financial stress. Reach out to a financial coach, who can brainstorm with you on ways to get a handle on your cash flow to free up resources to tackle debt and save for emergencies.

Many companies who offer workplace financial wellness programs encourage employees seeking retirement plan loans and hardship withdrawals to talk through the advantages and disadvantages with a financial coach and work through alternatives, if there are any. You’ll find that your financial coach or credit counselor listens without judgment, offers a practical process for coping with financial stress and anxiety as well as achievable action steps. That can be a lifeline when financial stress has become unmanageable.

3. Maximize your benefits choices

If you aren’t taking full advantage of your employer-sponsored benefits, you could be leaving as much as $1 million on the table over the course of your career. Before you make your benefits elections during open enrollment this year, schedule some time with one of your workplace financial wellness program’s financial coaches to do a complete benefits review with you, asking these kinds of questions:

  • Am I earning the full employer match in my 401(k) or 403(b) plan? How can I contribute more? Should I sign up for the automatic rate escalator?
  • What health insurance plan makes the most sense for me? How can I get the most out of it?
  • Am I leaving any money on the table in benefits I could be using?
  • Am I taking full advantage of all the ways to minimize my taxes?
  • Am I making the best use of the insurance benefits my employer offers?
  • Should I put more in a health savings account and/or a flexible spending account?
  • Can you help me understand all my voluntary benefits (e.g., legal, commuter, tuition, etc.)?
  • Can you help me calculate the value of my benefits as part of my overall compensation?

4. Run a retirement projection

Have you run a retirement projection yet? If not, you’re not alone. Half of all employees (51 percent) in 2016 didn’t know if they were on track or not for a comfortable retirement and only about one in four (27 percent) knew they were on track to reach their goals. Those who interacted with their financial wellness program over time, however, were nine percentage points more likely (58%) to have run a retirement projection and 11 percentage points more likely to be on track (38 percent).

The single most important step

The simple act of running a retirement projection may be the single most important step you can take to reach your retirement goals, per our research. If you find out you’re on track, this will reduce your financial stress and increase your confidence that you can meet your retirement goals on time or sooner. If you find out you’re not on track, you have the opportunity to change your saving or investing or adjust your assumptions, such as your target retirement date and how much you’ll need for expenses.

5. Get an unbiased second opinion on your investments

There are lots of great financial advisors out there, but there is also a small percentage that just wants to charge you high fees or worse, make off with your money. An unbiased financial wellness benefit – where there is zero selling of products or services – offers you the opportunity for a second opinion on your financial plan or investment proposal.

A financial coach can help you work through questions to ask your financial advisor and help you evaluate if your advisor’s recommendations fit your risk tolerance, time horizon and financial circumstances. They can help you check the credentials of any financial advisor you are considering hiring. Plus they should be able to help you understand the investment choices in your retirement plan in light of your financial goals and situation.

Remember, most financial wellness providers cannot offer you investment advice. They can’t tell you what to do. Rather, they can assist you in understanding your options and empower you to make the wisest choice for your situation.

6. Measure your progress

Making financial progress is a lot like losing weight. Getting physically or financially fit are both about making small changes in your behavior which you can sustain over a long period of time – preferably for life. The people who are the most successful are those who set a benchmark and track their progress.

If your financial wellness program offers you a tool for assessing where you start and a mechanism for tracking your progress, make sure to use it at least once per year. Check if your employer offers peer-to-peer learning opportunities (e.g., women and money, new employees group, etc). These offer accountability and encouragement. Having the support of a group of like-minded people is like having your personal cheerleading squad, and you’ll be more likely to “weigh in” on a regular basis.

Not every workplace financial wellness program is a true workplace financial wellness benefit, but it still may be able to help. Some companies only offer online tools, while others offer comprehensive programs which include unlimited 1 x 1 coaching. Check with your HR department on what’s available to you and how you can take advantage of it.

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