Peace of Mind

Published online: Mar 03, 2021 Articles Sean Reilly, CFP, Financial Advisor, Morgan Stanley
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This article appears as the cover feature in the March 2021 issue of Potato Grower Magazine

Imagine this: the productivity of one of your valued employees at the farm begins to plummet. He is clearly distracted, and this goes on for months. 

Then, you start noticing similar issues with his co-workers.

As the head of the company, you know this situation is unworkable. You want to help, both for the long-term health of your company, and because you care about your employees. So you start digging, trying to diagnose the problem. For many business leaders, the root cause is a stunner.

“It’s stress about their financial lives,” says financial advisor John Zitzmann of the Zitzmann Group at Morgan Stanley in Providence, R.I. “It’s surprisingly common — and a serious drain on productivity.”

Financial Stress a Major Concern

The data agree. One survey found that 85 percent of Americans feel anxious about their financial lives. Seventy-eight percent of employees with high financial stress say it impacts them at work. And that drain on productivity? Every month, employees squander 13 working hours worrying about money.

Not surprisingly, concern about money affects lower-wage earners, with one of the highest stress levels (68 percent) reported among those earning less than $60,000 annually. Still, more than half of high-income earners (above $100,000) also report feeling financial stress.

Perhaps most worrisome, all this stress has an alarming impact on people’s health. Employees with high financial stress are twice as likely to report poor health overall, and more than four times as likely to suffer from depression and other ailments. With the runaway costs of health insurance, financial insecurity is costing your business money.

But there is good news, too. Employers are embracing programs around financial wellness.

Financial Wellness Programs: How They Work

A robust financial wellness program can have a substantial impact across the company. And since many are built around online portals and self-directed educational tools, the costs can be quite modest.

“Our program is designed to build financial literacy,” says Zitzmann. ”We start with a series of diagnostic questions: What do people know, what concerns do they have, are they aware of their options? From the data, we create what we call a ‘journey’ — a series of bite-sized instructional pieces to help them understand their problems and how to potentially fix them.”

In addition to self-directed programs, people at all levels of income are increasingly consulting financial advisors.

“Our call center has financial advisors — professionals licensed to offer advice — who are accessible to participants,” says Zitzmann.

Financial advisors who focus on wellness do a lot more than recommend investment choices. “We deal with issues like debt, insurance, and cash flow,” says Zitzmann. “Investments are important, but a lot of people need basic financial planning.”

Financial Wellness as a Benefit

Offering financial wellness as an employee benefit is a trend that’s likely to continue — fully 94 percent of employers say they are likely to implement a financial wellness program.

“Nearly all companies offer health insurance and a retirement plan,” says Zitzmann. “But financial wellness can really impact your business.”

How? In one case, a trucking operation found that accident rates among drivers decreased following the implementation of a financial wellness program.

Some Hidden Benefits

Employers who implement financial wellness programs also see associated upticks in other programs.

“You spend a lot on a retirement plan, and then find disappointing rates of utilization or improper usage,” says Terence Reynolds, a financial advisor at Morgan Stanley. “But when employees participate in a financial wellness program, it actually increases their usage of their retirement plan.”

Financial wellness programs can be highly customized. “Different companies, different industries all have their own financial issues,” says Reynolds, “In large healthcare organizations, we found that doctors and nurses were deeply stressed by massive debt from student loans. So that became a focus.”

Is It Time to Act?

The trends are becoming clear: Financial wellness is becoming as important for recruiting and retaining employees as core benefits like health insurance and retirement plans.

“Employees are starting to expect it,” says Zitzmann. “Soon it’ll be a competitive necessity, in my opinion.”

A recent survey backs this up. Seventy-four percent of employees said it’s important for an employer to offer financial wellness benefits, and 60 percent said they would be more likely to stay at a job that provided useful financial wellness programs.

“Employees want help saving for retirement, planning for the future, saving more for emergencies, managing bills, controlling debt,” says Zitzmann. “They’re looking to employers for this assistance.” In fact, 71 percent say they’d be comfortable discussing financial matters at work with a financial professional; the number is even higher among younger employees. Getting in front of this trend can give companies an important competitive advantage.

And there’s another, perhaps even more important reason to act.

“When we talk to farm owners, they love the metrics and the business benefits,” says Zitzmann. “But really, they think of their business like a family. They don’t want to see their people suffer from stress and financial insecurity. They want what’s best for their people, to have a comfortable retirement, send their kids to college, and enjoy their lives. They want a financial wellness program because they care. For them, it’s great for the business, but it’s also the right thing to do.”