Employers plan to spend more money on financial wellness programs despite concerns over the programs' rising costs, according to a survey that the Employee Benefit Research Institute will release later this month.
Benefits decision-makers "are expecting their employers to step up and provide more money for these programs because they are gaining in popularity," said Craig Copeland, director of wealth benefits research at EBRI, during a symposium held Oct. 3 to tease the upcoming survey results.
More than 1 in 4 employers (26%) currently offering financial wellness programs spend more than $100 per employee annually on the initiatives, with 4% spending more than $500, Mr. Copeland said while presenting a high-level preview of the findings.
Nevertheless, 70% of employers expect to increase their budgets with the remaining 30% planning to keep the budget the same.
"Even though cost is a top challenge, these benefits have become an important part of what employers are offering," Mr. Copeland said.
One of the big differences in this year's survey is that retirement preparedness and healthcare costs — the two quintessential issues that financial wellness programs typically focus on — were bumped this year by the concerns over the high cost of living.
"That became a top issue of focus that wasn't there two or three years ago," he said, referring to the rising cost of living.
"Given the persistence of high inflation, employers have really tried to step up their financial wellness programs and help people understand how to save and spend in a high inflationary environment," he said.
Mr. Copeland also reviewed program takeup metrics, noting that 33% of firms offering financial wellness benefits reported that more than half of their employees use them.
The largest percentage of respondents (38%) said that 26% to 50% of eligible employees take advantage of the programs.
Even though usage is "on the low side," it is still better than what employers expected, with 61% reporting that it was more than what they thought, Mr. Copeland said.
The survey also looked at how employers are measuring the effectiveness of the programs with most (54%) tracking employee satisfaction, followed by employee productivity (44%).
The theory is that the greater an employee's financial wellness, the greater his or her productivity because financial worries are less of a distraction.
Employers are tracking employee satisfaction at a higher rate than productivity even though they say that productivity is more important, Mr. Copeland said.
Mr. Copeland explained that one reason that employers are looking at employee satisfaction more than at productivity is that it's easier to measure satisfaction than it is to measure productivity.
"Productivity is going to be a very hard thing to measure," he said.
The survey, which has been conducted annually since 2018, polled 252 full-time benefits decision-makers in July and August.
