There has never been a better time to show your employees that you appreciate them. In our previous article, 9 Critical Strategies to Attract and Retain New Workers, we mentioned that the U.S. economy has been improving, which has opened up a whole new set of problems such as labor shortages and skill deficits in the country. What can you do to keep your current workforce and prevent them from jumping ship?

In this article we’ll be talking about financial literacy, how it can benefit your employees, and what you can do to enhance this particular competence in your employees.

What is financial literacy?

Simply put, financial literacy is the ability to comprehend and successfully apply various financial skills such as budgeting, saving, investing, and personal financial management. In addition, expanding financial literacy also means starting to use various financial concepts and principles. These include compound interest, financial planning, high-reward investment strategies, money-time value, and debt management. By developing financial literacy, an individual has a much higher chance of finding success and financial stability in their life.

How does financial literacy benefit my employees?

By now, we’ve established how crucial being financially literate is. However, a lot of Americans fail to develop their financial literacy and put themselves at risk of encountering money problems down the road. In fact, in a report on the Tennessean, it highlights that despite being the world’s largest economy, America is ranked 14th when it comes to having financially literate adults. In addition, recent research indicates how only 37% of Americans were able to answer questions about compound interest, inflation, and diversification.

As aforementioned, not being financially literate can cause money problems in the long-term. Which, in turn, causes serious financial stress. If left unchecked, this financial stress can lead to health problems such as anxiety, depression, high blood pressure, and diabetes. This can seriously affect your employees and their quality of work. Because financial stress makes it impossible for your employees to fully concentrate at work, they will become less productive and lead to higher absenteeism.

So if you’re keen on keeping the employees that you have and don’t want them to succumb to financial stress, you should strive to enhance their financial literacy.

In The Spotlight

How can I increase my employees’ financial literacy?

Help your employees assess their financial wellness. The main reason why people find it difficult to plan their finances is that they’re not fully aware of the scope of their financial literacy. Because of this, it’s beneficial that your employees take a financial wellness quiz so they can gauge their financial literacy and see the areas that they need to improve on. USFinancialCapability.org provides a short financial literacy quiz that can help your employees evaluate their financial wellness.

Encourage them to look for helpful resources and tools. There’s a plethora of financial literacy resources and tools that your employees can find on the internet. For one, trusted finance website AskMoney.com notes in one of their articles how certain TED talks can provide a lot of financial insight, from must-know basics to advanced topics like mastering the stock market. These include: “10 Steps to Boost Your Financial Health — That You Can Do in a Day” by Wendy de la Rosa and “Six Ways to Improve Your Relationship With Money” by Thasunda Duckett.

You should also recommend budgeting apps such as Mint and Personal Capital to your employees. Through these apps, they can manage their budgets and finances on their phone. The internet is a treasure trove of financial resources, so be sure to keep an eye for those that can enhance your employees’ financial literacy.

Employ a financial counselor. As a key part of your financial wellness program, you can offer your employees free consultations with a financial counselor. These professionals can help your employees understand their current financial situation and assist them in creating a plan to achieve financial stability. In addition, financial counselors can also provide advice on how to handle investments and create long-term savings plans, which can significantly reduce their financial anxiety and stress.

All in all, improving your employees’ financial literacy is key if you want to retain the talents that you have invested so much time and money in.

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Johnny Collins
About The Author Johnny Collins
Johnny Collins worked for investment companies before deciding to leave the corporate space and become a freelancer. He now takes on financial/investment analysis projects, as well as writing opportunities that cover economy, business and tech.




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