Most financial wellness programs are about counseling employees, not about actually increasing the amount of money in their pockets. By analogy, the former programs are like putting employees in stress management programs rather than trying to find the “root cause” of what is making their jobs so stressful.
It happens that we do have some solutions— ways to put actual money in your employees’ pockets through “financial wellness”— that wouldn’t cost you anything. Our CEO, Al Lewis, posted them on LinkedIn and got a great response. So we thought they might be worth sharing here. We’ll start you off with the introduction and then you can follow the link to the rest. Let us know what you think, by commenting right on LinkedIn.
Imagine a risk-free, tax-exempt annual return of 20%.
As I write and get feedback on financial wellness questions for www.quizzify.com, one financial opportunity stands out way above the rest. This opportunity does indeed include a 20%, risk-free and tax-free return. It also addresses worker stress and therefore probably health issues as well.
As you’ve probably guessed by now, it’s paying off your credit cards. After paying them off, slice them in half and never, ever get near one again. Use a debit card. Or get a card with a low credit limit, because there are some transactions (car rental, for example), where there is no easy substitute for a credit card.
Do the math: average credit card debt exceeds $15,000, for people who carry balances. The average interest rate – with no tax deduction allowed – is about 20%. Figure the average employee making $35,000/year faces a combined federal, state and FICA tax rate of somewhere around 20%, depending on the state. That means around 10% – a tenth – of the employee's income is going to consumer debt service. And that's before mortgages and student loans.
No wonder employees are stressed out. If they could pay off this debt, they would.
Read more by visiting the article on LinkedIn … including the slam-bang conclusion about how you can help employees with this and other issues, with no net budget required.
Quizzify’s role in this? Financial literacy for employees is as important to us as health literacy, and our curriculum reflects that. You can also easily customize questions to educate your employees on your health savings accounts, retirement accounts, etc. Contact us to learn more.