Employees have been clamoring for on-site personal finance education for some time. And now there’s compelling evidence that it’s a worthwhile investment for employers to make.
Why? Workers who take part in one-on-one financial counseling during the workday are more likely to put more money aside for retirement than their peers who didn’t take part in the counseling.
Personal finance education vs. no education
The Principal Group recently compared the saving habits and financial acumen of workers who attended a one-on-one session the organization offered in 2011 to those who didn’t.
What it found: Contribution rates for those who attended the session were 9% higher than those who didn’t. Also, 19% of the workers who received education opted to automatically bump up their retirement plan increases with pay increases, compared to just 2% of other employees.
Also, 92% of the employees who were enrolled in Principal’s education program agreed to take a number of positive financial steps, and a full 80% of those workers followed through on those steps.
On company time
Here’s another way to look at the advantages of bringing personal finance education in house. Research by Financial Education and Literacy Advisers says that U.S. workers spend upwards of 28 hours per month researching personal financial issues. That, the organization says, can translate to lost productivity costs of up to $5,000 per employee each year.
Offering employees personal financial education is a proactive way to prevent money worries from interfering with people’s day-to-day work.