This blog talks about the importance of financial well-being, and the role of payroll in securing employees’ financial wellness.

1. Role of payroll in securing employees’ financial well-being | Exela HR Solutions Blog
Role of payroll in securing employees’ financial well-
being – Exela HR Solutions
As remote work becomes more prevalent, the line between professional and personal life has
become increasingly blurred. This has prompted HR leaders to prioritize employees' well-being and
mental health, recognizing the importance of cultivating a healthy work-life balance. Fostering
employee well-being is, therefore, essential for promoting workplace resilience.
68% of HR leaders say employee well-being and mental health are their top priorities.
This priority is understandable, given that the corporate well-being industry in the United States is
currently valued at $20.4 billion and is expected to reach $87.4 billion by 2026. In addition, a
survey found that 80% of employers believe that financial stress negatively impacts their
employees' performance, costing around $500 billion annually.
The modern workforce faces numerous stressors, and many employees feel ill-equipped to
effectively manage these challenges. When stress and anxiety arise, employees may struggle to
showcase their skills and talents. In such a climate, it falls to managers to prioritize the well-being
of their team members. This begins with ensuring that compensation packages are competitive,
offering clear opportunities for career advancement, and keeping pace with inflation. However, HR
leaders should also consider providing free financial coaching as an employee benefit, regardless
of pay level. Financial wellness has emerged as the most frequently requested benefit among
employees, and offering such services can deliver tangible value. Employers should understand the
crucial role of financial well-being and payroll and explore ways that payroll can promote financial
wellness throughout the organization.

2. Role of payroll in securing employees’ financial well-being | Exela HR Solutions Blog
What is financial well-being?
Financial well-being pertains to achieving a state of financial security and control, not only in the
present but also in the future. It brings a sense of reassurance that one can manage their living
expenses and cope with unforeseen emergencies, as well as the liberty to make choices without
constantly worrying about finances.
Financial well-being is not solely determined by an individual's financial status but also by an
employer's commitment to their workforce and the prioritization of their needs. Employers serve
as the primary source of income for their employees, making them a critical factor in promoting
financial well-being. As such, it is essential for employers to take an active role in supporting their
employees' financial health by providing benefits and resources that go beyond salary or wages. By
recognizing the importance of financial wellness and taking action to promote it, employers can
improve the overall well-being and satisfaction of their workforce.
Nevertheless, the reality is:
Only 11% of employers with health and well-being strategies actually focus on financial well-
being.
Numerous companies have adopted a carrot-and-stick model that provides short-term solutions to
their employees' financial difficulties rather than supporting the establishment and growth of long-
term assets. However, such an approach is insufficient and fails to address the root causes of
financial stress. It also neglects the importance of cultivating employee loyalty and retention by
satisfying their needs beyond mere compensation.
72% of employees say they would be attracted to another company that cares about financial
well-being.
The economic impact of the pandemic has highlighted the importance of financial stability for
today's workforce. With rising levels of household debt, employees are increasingly turning to
their employers for support through expanded financial wellness initiatives and comprehensive
benefits packages. Workers may be more likely to seek employment elsewhere when such aid is
unavailable, potentially even turning to the gig economy.
Also Read: Employee Engagement Starts with Accurate Payroll Outsourcing

3. Role of payroll in securing employees’ financial well-being | Exela HR Solutions Blog
Why is financial well-being important?
Financial wellness is a critical factor in promoting employee retention and engagement, and it can
also attract top talent that can help ensure the company's long-term viability and growth. In
addition, by offering comprehensive financial wellness programs and benefits, organizations can
create a more stable and satisfied workforce better equipped to weather unexpected challenges.
84% of employers say financial well-being can aid in reducing employee attrition. While 81% say,
financial wellness tools help attract higher-quality employees.
Employers must work together with their workforce to understand their needs, identify the areas
of support, and develop appropriate solutions while aligning with the organizational revenue goals.
Ensuring financial stability and showing appreciation are crucial for employee satisfaction, and
organizations that prioritize financial wellness can reap greater benefits from their human capital
investments.
It has been proven that organizations providing financial coaching, loan repayment programs,
immediate credit, cashback, allowances, incentives, employee discounts, and other perks are more
likely to attract enthusiastic and skilled workers who are committed to the growth and
advancement of the company. In addition, employees appreciate employers who promote their
financial welfare by offering tailored coaching and plans aimed at assisting them with purchasing a
home, finishing their education, starting a family, or managing child care and education. In return,
employees demonstrate their appreciation through increased productivity and profitability.
The general consensus is that employees tend to prefer working in an environment where their
contributions are valued. In addition, companies that provide adequate financial wellness benefits,
including wealth creation schemes, healthcare coverage, retirement benefits, and travel expense
coverage, create a sense of appreciation and loyalty among their workforce, encouraging them to
remain committed to the organization's goals.
Given the profound effect of financial problems on mental health, companies offering
individualized financial coaching services alongside mental health resources can boost motivation,
productivity, attendance, and overall engagement, thereby positively impacting the bottom line.
The Role of Payroll
While it's positive to see companies expanding their financial wellness benefits to include
alternative options such as automatic student loan payments and direct personal investment tools,
such programs must prioritize enhancing employees' financial literacy to be truly effective.

4. Role of payroll in securing employees’ financial well-being | Exela HR Solutions Blog
Without adequate financial education and guidance, employees may struggle to make informed
decisions that align with their financial goals. Therefore, companies should focus on offering
comprehensive financial education and resources that enable their workforce to make informed
financial decisions and take control of their financial future.
Improving financial literacy is critical for employees seeking greater control over their finances.
The payslip serves as a starting point for every worker, and payroll processing can play a crucial
role in positively impacting their financial well-being. Even without introducing new benefits,
employers can take simple steps through their payroll processing to assist workers in gaining a
better understanding of their financial situation and available choices. For example, providing clear
and concise pay stubs that break down deductions and taxes can help employees understand their
take-home pay and make more informed financial decisions. In addition, by prioritizing financial
literacy and education, employers can help their workforce build long-term financial stability and
security.
Ways payroll processing can help promote financial well-being
 Help employees understand their payslip
Payslips are critical to employees, but unfortunately, only a small percentage take the time
to review them or understand their contents. In addition to providing information on total
income and taxes, payslips offer insight into how earnings are distributed, even before they
are received. Employees must understand the various deductions, rates, and calculations, as
this knowledge can help them control their finances better. By monitoring regular
contributions to a pension scheme, employees can alleviate concerns about retirement
plans or make informed decisions about other investments. Furthermore, scrutinizing the
deductions listed on their payslips can help employees identify services they were
previously unaware of, such as monthly physiotherapy coverage through health insurance.
Payroll processing professionals are a valuable resource for employees seeking to enhance
their financial literacy, as they have the expertise to interpret payslip information and
answer questions about deductions.
 Encourage engagement with existing supports
Many employees may be eligible for financial benefits from their employer, such as
consultations with financial advisors, investment app trials, or government schemes for
meal vouchers or childcare. However, some employees may not be aware of these
opportunities. Payroll processing can help by reminding employees of these benefits
through their monthly or semi-monthly payslips or through other means such as email or a
public messaging board on payday. Employers can also use the blank spaces on payslips to
draw attention to available benefits and share resources for saving, investing, budgeting,
and debt management. Additionally, organizing educational sessions for staff to understand
mandatory deductions and social contributions and utilizing those funds can also effectively
promote financial literacy and engagement with existing benefits.

5. Role of payroll in securing employees’ financial well-being | Exela HR Solutions Blog
 Obtain employee feedback
To determine the most effective strategies for promoting financial wellness among
employees, companies should directly ask their workforce for input. By obtaining employee
feedback, employers can learn about the financial tools and benefits that are most relevant
and appreciated. This approach shows employees that their contributions are valued and
the company is committed to supporting them. One effective way to gather feedback is to
provide suggestion boxes in common areas or a dedicated section on payslips where
employees can give feedback on existing financial benefits or recommend new resources.
Employers could also distribute feedback forms, surveys, and payslips to gather opinions
and suggestions. Even if initial participation rates are low, these initiatives gently remind
employees to consider their financial health and explore available options.
Conclusion
While employers cannot entirely address their employees' financial challenges, they can take
proactive measures to encourage them to manage their financial well-being. Global payroll
processing teams, with their comprehensive understanding of employee salaries, benefits, and
deductions, play a vital role in assisting their colleagues. Employers who invest in understanding
and supporting their employees' financial wellness, whether through company initiatives or public
resources, are likely to benefit from their investment in the long run. By doing so, they can foster a
loyal and satisfied workforce, ultimately enhancing the organization's reputation and financial
stability.
If you're unsure of how to create a strategy to promote the financial well-being of your employees,
outsourcing your payroll could be a viable option. By partnering with Exela HR Solutions, a market
leader in HR and payroll outsourcing, you can benefit from our best-in-class solutions to meet your
HR needs. In addition, our team of experts can assist you in creating a comprehensive plan to
support your employees' financial well-being. Contact Exela HR Solutions today to start the
conversation and take the first step towards a more financially healthy workforce.
DISCLAIMER: The information on this site is for general information purposes only and is not
intended to serve as legal advice. Laws governing the subject matter may change quickly, and
Exela cannot guarantee that all the information on this site is current or correct. Should you have
specific legal questions about any of the information on this site, you should consult with a
licensed attorney in your area.
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