According to Forbes, over 60% of employees report being stressed due to their financial situation. This stress can negatively affect both physical and mental health and even personal relationships, including those with colleagues. However, when financial stress is reduced, employees report being 84% happier and 78% more engaged. A workplace well-being strategy that includes financial wellness initiatives—not only education and resources but also ongoing support—can deliver long-term savings for employees and employers.

Every employee’s financial situation is personal and unique, and there are many reasons they may feel dissatisfied with their current financial state. Common sources of financial stress include student loan debt, credit card debt, medical bills, family-related expenses (such as buying a home or supporting a child) and unexpected costs.

According to recent reports, 80% of U.S. employees experience at least some level of financial stress, making it a top source of worry for many. About 41% of working Canadians are financially stressed, up from 37% last year, according to a report from the National Payroll Institute.

The impact of financial stress takes a huge toll on physical and mental health. According to the Financial Consumer Agency of Canada, those who are dealing with financial stress are:

• Twice as likely to report poor overall health
• Four times as likely to suffer from sleep problems, headaches and other illnesses
• More likely to experience strain on personal relationships.

Financial stress can also lead to more serious health problems, including heart disease, high blood pressure, and mental health conditions such as depression and anxiety. In some cases, high financial stress combined with low financial wellness can create a vicious cycle of unhealthy coping behaviors, such as overeating, increased alcohol consumption, and tobacco or drug use. These habits can, in turn, lead to increased spending and the potential for even greater medical bills.

Before identifying how employers can support employees with their financial wellness, it’s important to first understand what financial wellness truly means. According to the Consumer Financial Protection Bureau (CFPB), financial wellness means having financial control that provides someone with security and freedom of choice. It includes the following:

• Maintaining control over day-to-day and month-to-month finances
• Having the ability to absorb financial shock
• Being on track to meet financial goals
• Enjoying the financial freedom to make choices that enhance life satisfaction.

While it’s not solely the responsibility of employers to solve employees’ financial challenges, they can support them by offering financial wellness initiatives as part of a comprehensive wellness strategy. Like any other wellness strategy, a financial wellness initiative is most effective when communicated through multiple channels and viewed as an ongoing priority, rather than a highlight once a year at open enrollment, for example. Finances are deeply personal, and changing financial behaviors can be challenging. However, financial wellness solutions matter to employees, with 77% seeing them as an important benefit, according to a report shared by the Harvard Business Review (HBR). The strategies below offer key considerations for supporting employees’ financial wellness.

• Deliver financial education. On average, employees spend about eight hours each week worrying about finances, with four of those hours occurring during the workday. Many people struggle to know where to start when it comes to overcoming financial challenges. Offering education from unbiased sources on topics such as financial literacy basics, budgeting, debt management, saving, investing and retirement can reduce weekly worry by at least one hour.

• Help employees maximize their benefits. Nearly half of employees find benefits— including financial benefits—confusing, and making the best choice can feel overwhelming. In fact, 45% of employees report guessing the right amount of savings they need to retire, while only 29% have a retirement plan, according to HBR. In addition to encouraging open dialogue with HR, make sure employees know who and where to turn to for answers and how to receive support, enabling them to make the most informed decisions possible.

• Provide access to professional financial services. Hiring an unbiased third party to support employees with their financial wellness is an additional way to continually invest in their well-being in a safe and fair manner. Several factors influence an individual’s financial situation, including:

• Confidence about money
• Spending and saving habits
• Short-term and long-term planning
• Overall financial needs.

A third party can offer an additional level of education and support to better address these needs.

• Make financial wellness the default. Financial wellness initiatives can be impactful just by using what you already offer and making small adjustments. For example, to encourage behaviors that support financial well-being, consider switching financial benefits, such as the 401(k), from an opt-in to an opt-out system. This small change can make the process easier for employees and help foster greater participation.

• Recognize that financial wellness requires a holistic approach. As with other wellness initiatives, flexibility should be prioritized when possible. Financial stress can arise unexpectedly, often requiring employees to allocate some of their workday to address these challenges. If feasible and appropriate for their position, allowing employees the autonomy to manage their own schedules and trusting them to complete their work can be particularly valuable in these situations. Additional ideas to consider include “No Meeting Mondays” and “Flexible Fridays,” further supporting employee flexibility should unexpected financial issues, or other challenges, arise.

Eighty-four percent of employers believe offering financial wellness tools and resources improves employee retention, and when paired with other wellness initiatives, improves productivity and innovation, yet 28% of employers offer them. When employees achieve financial wellness, they have greater overall well-being, and they bring their best selves to work. By investing in financial wellness, employers not only support their employees’ well-being but also create a more engaged, productive and healthier workforce—ultimately saving more than they might have anticipated.

Get more tools to support financial wellness! The theme of National Employee Benefits Day 2025 is Future-Ready Financial Wellbeing. Find resources for your organization and your employees on the #BenefitsDay webpage. Join us for a free webcast on Wednesday, April 2 entitled Employee Financial Wellness that Works!