Financial Planning
- When employers facilitate life event financial planning for employees they create a culture of caring for employees. And employee satisfaction is as a competitive advantage. Employer-employee relationships can be improved by reaching out to employees with financial guidelines during life events such as marriage, children’s birth, and/or divorce. These services can be outsourced. Customers want to believe they purchase products and services from firms who care about their employees. And employee satisfaction is directly linked to customer satisfaction.
- Continuous and systematic involvement in the employees’ life events can be used to increase awareness of employer benefits, such as employer contribution to employee retirement plans. Some of these benefits can be tied to employee life events such as job promotion and retirement options.
- If life event financial planning is viewed as a benefit, managers and supervisors may have more ability to detect and refer employees for financial and tax counseling. In the absence of life event financial planning, vulnerable groups such as young employees may resort to extreme measures such as payday lenders.
- Life event financial planning reduces stress over financial matters such as children’s education and an emergency fund. And employee stress influences job performance of the employee and potentially the employees work team.
- Many employees do not understand their W-4s and business expenses. Providing tax preparation tips may reduce Human Resource costs by decreasing individual requests for financial planning and tax preparation questions such as business expense deductions.
Click here to go to the next topic, Credit Scores, to see how improved credit makes for a happier, healthier employee.
About the Financial Literacy Center
The FLC's mission is to develop and test innovative programs to improve financial literacy and promote informed financial decisionmaking.
With support from the Social Security Administration, the Center was established in October 2009 by the RAND Corporation, Dartmouth College, and the Wharton School of the University of Pennsylvania in order to develop educational tools and programs that help individuals prepare for their long term financial stability.
About the Program
Presented by the Financial Literacy Center, a joint center established by the RAND Corporation, Dartmouth College, and the Wharton School of the University of Pennsylvania in order to develop educational tools and programs that help individuals prepare for their long-term financial stability.
Success Stories
Take a look at how companies like Mandarin Oriental Hotel Group and Nationwide have had success with automatic enrollment and automatic escalation.
The Dartmouth Project
Increasing employee participation in retirement plans has always been a challenge.
However, researchers at Dartmouth College, through a grant provided by the National Endowment for Financial Education, show that specific low-cost strategies succeed in boosting employee participation rates.
