Productivity loss from employees dealing with debt costs U.S. businesses over $40 billion annually
SAN MATEO, Calif., June 28, 2022 /PRNewswire/ -- Freedom Financial Network (FFN), a leading digital personal finance company, released a new whitepaper, Filling the Gap in Financial Wellness Benefits, which examines how employers that expand financial benefits beyond traditional wealth management and retirement savings programs can reduce workers' stress and improve productivity.
In recent years, workplace benefits have grown beyond retirement and health insurance to include financial wellness programs focused on wealth accumulation and savings for financially secure employees. But the reality is that a significant segment of the workforce struggles to meet day-to-day cash flow needs and is unable to use these long-term planning vehicles.
Research indicates that employer-sponsored financial wellness benefits that help workers repay or manage their debt can significantly reduce employee stress, alleviate other wellness issues and mitigate workplace productivity losses that result from employees' present-day financial struggles.
"Today, very few companies offer comprehensive financial wellness programs, leaving gaps in benefit offerings, especially for the growing number of people who are too focused on their immediate financial struggles to adequately prepare for the future," said Andrew Housser, co-founder and co-CEO of Freedom Financial Network. "In the U.S. alone, businesses experience over $40 billion in annual productivity losses due to their employees' struggles with unsecured debt. By expanding workplace benefits to include financial literacy and education, debt management or resolution offerings, budgeting help or even debt consolidation programs, more employees can have their financial needs met and get on a path to a better financial future."
Examples of four key financial wellness benefits that focus on meeting the needs of debt-stressed employees include:
- Budgeting tools: Employees who are dealing with tight finances need access and assistance in using a budgeting tool that can help them manage cash flow. By learning to proactively plan for and anticipate needs, employees can avoid some of the stress and time that come with constant reactive behavior. Ideally, a budgeting tool will be a part of a broader financial education and literacy effort and include an app-based platform.
- Debt management tools: As part of that broad financial education effort, employees who are dealing with significant debt need help finding a pathway out. They need to start by understanding the range of alternatives that are available, including a debt management plan that can help some people who are struggling with credit card debt with a lower interest rate.
- Debt consolidation programs: Debt consolidation can be a powerful tool for making debt payments both more affordable and easier to manage. This type of program can incorporate the buying power of a benefits platform to make discounts available for participants.
- Debt resolution services: The most acute debt problems involve having to deal with creditors and collection agencies — demands that often require attention during work hours. Debt resolution services can provide relief by reducing the principal amount of the debt the employees owe, and by helping to organize payments.
For more information about financial wellness benefits, download the Filling the Gap in Financial Wellness Benefits white paper: https://www.freedomdebtrelief.com/media-assets/surveys-studies/
Freedom Financial Network is a leading digital personal finance company. We do what traditional banks don't: Put people first. Our solutions help everyday people get on, and stay on, the path to a brighter financial future, with innovative technology and personalized support. By leveraging proprietary data and analytics, our solutions are tailored for each step of a consumer's financial journey and include personal loans (FreedomPlus), home equity loans (Lendage), help with debt (Freedom Debt Relief), and even financial tools and education (Bills.com). Freedom Financial Network has more than 2,300 dedicated employees across California, Arizona and Texas and is recognized as a Best Place to Work. For information on career opportunities at Freedom Financial Network, visit: https://jobs.freedomfinancialnetwork.com/
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SOURCE Freedom Financial Network