Financial wellness (or financial well-being) refers to a person’s overall financial health and the absence of money-related stress. It’s the result of successful expense management.
Financial wellness is an important part of overall employee wellbeing which consists of physical, mental and financial wellness. According to the Society for Human Resource Management, financial stress results in a 34% increase in absenteeism and tardiness. Employees who worry about money also miss almost twice as many days per year compared to their unstressed colleagues.
Money-related stress can also lead to an increase in presenteeism; employees coming to work despite being physically or mentally unwell.
Employee financial wellness programs are programs that help employees (better) manage their finances and reduce financial worries. As such, they contribute to a better overall financial wellbeing for employees. One of the program elements is on-demand pay. Having access to earned by unpaid wages removes the reasons for using costly between-paychecks financing like payday loans, installment loans, title loans, sub-prime loans which exploit the needs of hard working employees.