Check out this snippet of an article that appears on the Business Mirror's Philippines site:
Dr. E. Thomas Garman, who has done over 20 years of research on financial literacy, calculates that the benefit-to-cost ratio to employers of empowering their employees financially through financial education is 3:1. ... [T]hese studies and calculations are for US workers....
When asked what would make them financially free, employees would normally say a higher pay. But both Dr. Garman and I believe that more money is not the answer; better personal financial management is. ...
Employee financial education is a critical component of employee-wellness programs. When properly executed, employee financial education will help reduce stress both at the workplace and at home.
This is the opinion of Efren Ll. Cruz, a financial planner with the Registered Financial Planners Institute USA. When it comes to your workplace team building and employee engagement best practices, he makes the case for including a financial education component to reap the following benefits that make up the $3 gained (in some cases, saved) for every $1 spent on these programs:
- Lower employee stress related to finances - means fewer unscheduled absences, less use of sick leave, and higher productivity
- Enhanced company loyalty
- Better appreciation of and participation in company benefits
- Employee retirement readiness
Related: Our Workplace Perspectives feature on employee finances.
Do your employee activities involve a financial education component? If yes, what is your related benefit-to-cost ratio?
Photo credit: Benefits and Pensions Monitor
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Comments for Financial Planner: Benefit-to-Cost Ratio of Employee Financial Education is 3 to 1