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Read More (PowerPoint)... Read More (PowerPoint)... Presentation Transcript

  • Measuring the Impact of Workplace Financial Education and Advice: A Pre-post Design Virginia Tech’s National Institute for Personal Finance Employee Education Jinhee Kim Presented at the 5th National Conference on PFEE November 9, 1999
  • Introduction
    • SECURA Insurance Companies located in Wisconsin, Michigan, and Indiana
    • Pre-and post-assessment design
  • Procedure
    • Pre-assessment in February 1999
    • Financial education seminars in March
    • Post-assessment in June (three months after the seminars)
    • One-on-one financial planning advice counseling sessions in July
    • Advice survey in August and September
  • Demographics
    • White, some college education
    • Average age of 39 years
    • With current employer (1/2 less than 5 years and 1/5 over 15 years)
    • Median household income $60,000 - $70,000
  • Individual Character-istics Financial Attitudes, Knowledge Behaviors Financial Well-being Personal Finance-Work Conflict Work Outcomes   Productivity Absenteeism Work time wasted Organizational commitment Pay satisfac- tion Intention to leave     Workplace Financial Education T he Kim Model of Workplace Financial Education, Financial Well-being, and Work Outcomes
  • Attitudes Behaviors Knowledge Financial Well-being Personal Finance Work-Conflict Performance Rating, Absenteeism, and Pay Satisfaction Structural Equation Model
  • Financial Well-being Predicts Productivity
    • This study of white-collar workers demonstrates that financial well-being directly predicts employees’ performance ratings, pay satisfaction, conflicts between work and money matters, and absenteeism.
    • It also indirectly predicts job loss and organizational commitment.
  • Impacts of Workplace Financial Education and Advice
    • As a result of the education and advice, employees:
    • were more confident about their personal finances and their investment decisions,
    • changed how their assets were allocated within their 401(k) retirement plan,
    • increased the amounts of their 401(k) contributions and personal savings,
    • reduced debts, and
    • sought additional advice from a financial planner
  • Would Employees Like Additional Financial Education and Advice?
    • If their employer pay for it, 75% would like a financial checkup from an outside provider
    • One out of five respondents did seek further professional financial advice
    • Three-quarters say they might need a more comprehensive financial advice
    • 90+% would be willing to make a co-payment for a comprehensive financial analysis IF government paid some of the cost
  • Key Research Elements of Workplace Financial Education
    • 1. Financial wellness
    • 2. Retirement plan participation
    • 3. Benefits participation
    • 4. Workplace financial education
    • 5. Workplace financial advice
    • 6. Health care costs
    • 7. Health (stress, physical, emotional)
  • Key Research Elements of Workplace Financial Education (cont.)
    • 8. Knowledge (of financial literacy)
    • 9. Attitudes (and confidence about financial
    • issues)
    • 10. Behavior (on financial issues)
    • 11. Productivity measures -- absenteeism,
    • work time wasted, job turnover,
    • performance rating, etc.
    • 12. Commitment to job and organizational goals
    • 13. Demographic variables
  • What is Needed Now?
    • Research - with your help - is needed to prove that financial education positively impacts financial well-being and productivity.
    • Then, one day soon employers will provide workplace financial education to their employees because they are convinced that it improves workers’ personal financial wellness as well as the organization’s bottom line (e.g., absenteeism, turnover, health care costs, worktime wasted on money matters).
    • This scenario will not happen without convincing research or without your help.