Bringing Financial Wellness Services into the Workplace December 14, 2017
Welcome Carmen Shorter Senior Manager for Learning Field Engagement Prosperity Now
Housekeeping ▪ This webinar is being recorded and will be available online within one week ▪ All webinar attendees are muted to ensure sound quality ▪ Ask a question any time by typing the question into the text box of the GoToWebinar Control Panel ▪ If you experience any technical issues, email gotomeeting@prosperitynow.org
Prosperity Now’s mission is to ensure everyone in our country has a clear path to financial stability, wealth and prosperity.
Our Unique Promise We open doors to opportunity for those who have been kept off the path to prosperity. We help people build wealth by making sure they have what they need to build a better future. We enable meaningful mobility through research, policies and solutions.
Today’s Speakers Joanna Ain Mathieu Despard Pamela Chan Santiago Sueiro Sr. Policy Manager, Faculty Associate Project Director, Program Associate, Center for Social Federal Policy Human Insights Savings & Financial Prosperity Now Development / Prosperity Now Capability Executive Director Prosperity Now UNC Center for Community Capital
Setting the Stage Joanna Ain Senior Policy Manager, Federal Policy Prosperity Now
Today’s Agenda ▪ The State of Workplace Financial Wellness Programs ▪ Audience Q& A ▪ The Financial Wellness Needs & Preferences of Young LMI Workers ▪ Financial Wellness Services: Resources for Employers ▪ Audience Q&A ▪ Close
Workplace Financial Wellness Programs Research Findings & Projects Mathieu Despard Center for Community Capital, UNC-Chapel Hill Co-Authors: Meredith Covington, Ellen Frank-Miller, Geraldine Hannon, Michal Grinstein-Weiss, Washington University in St. Louis
Research Program • Aim: to assess the potential for and effectiveness of workplace financial wellness programs (FWPs) among low- and moderate- income (LMI) employees Workplace FWPs have potential to reach LMI households at much larger scale than community-based programs Support from the Ford Foundation, JPMorgan Chase Foundation, and W.K. Kellogg Foundation
Phase 1 Research 1. Employer survey (N = 93) 2. In-depth interviews (N = 24) 3. Intensive case studies (5 providers, 7 companies) 4. Employee survey (N = 16,652)
Emplo loyer Survey Fin indin ings Companies offering FWPs motivated to help employees. Companies not offering FWPs unsure of FWP effectiveness
Emplo loyer In Interview Fin indin ings • Definition of EFWP fluid; retirement focus • Financial counseling/coaching offered through EAPs • Reluctant to administer grant or loan programs for emergencies • Greater barriers serving part-time and lower paid employees
Case Stu tudy Fin indin ings Facilitative factors • Management promotion, continuous communication • Part of on-boarding, universal eligibility • On-site services • Bilingual services • Administrative ease
Less than 10% said employers offered a financial wellness program (except split deposit) Survey of f Much higher utilization among Lower- employees w/financial difficulties In Income Most interested in split direct Emplo loyees deposit; also interested in payroll advance loans, financial coaching, online tools
Low-Income Emplo loyees Self-selection - Utilization rates higher for: • Financial management classes ( p <.05) and tools ( p <.01) among employees who consider themselves to be careful budgeters . • Payroll advances ( p <.001), in-person financial coaching ( p <.01), and credit counseling ( p <.05) among employees with difficulty covering expenses .
Low-Income Emplo loyees • Similar income, but very different balance sheets! • Findings suggest some distressed/not distressed bifurcation • Workplace might be gateway for more affordable credit products for distressed employees
Phase II Research – employee outcomes: Do Fin inancial l • Small dollar installment loans Well llness (TrueConnect – Employee Loan Solutions) Programs • Financial Coaching (Neighborhood Trust Financial Partners) Work? • Credit Building (Working Credit)
Assessing Outcomes • Dosage effects: Do outcomes vary based on # of touches, hours of coaching, types and # of digital engagements? • Subgroup effects: Do outcomes vary based on demographic and financial characteristics of employees? How do these characteristics interact with FWP services? • E.g., phone-based financial coaching may work better among women with at least $1,000 in liquid financial assets
Assessing Outcomes • Credit outcomes: capture credit data for at least 3 time points – interrupted time series design:
Assessing Outcomes – Oth ther Optio ions • Waitlist control group: matched with the treatment group based on motivation; services are delayed, assess differences with treatment group during delay interval. • Treatment As Usual (TAU) control group: Condition Credit score-pre Credit score-post Difference Assess the Coaching 580 605 25 “difference in differences” Coaching + credit 575 615 40 among the 3 Coaching + credit + savings 590 625 35 groups
Checking In What questions do you have? Share them in the Questions box!
Creating Opportunities for Young Workers to Thrive Pamela Chan Project Director, Human Insights Prosperity Now
Financial Security at Work Prosperity Now’s portfolio of projects looking at how the workplace can be a pathway for building financial wellness among LMI workers. ▪ Understand challenges* ▪ Background review of existing publications and services ▪ Listen and learn events with practitioners and policymakers ▪ Research study to understand the perspectives of young, LMI workers ▪ Advance products & solutions ▪ Workplace financial wellness services directory & resources for employers** [ in collaboration with CSD ] ▪ Share human insights from young workers and recommended practices from past innovation pilots with service providers and employers ▪ Broker cross-sector relationships ▪ Advisory group of Human Resources and Workplace-Based Financial Wellness experts *Made possible with a grant from Prudential Foundation. **Made possible with a grant from JPMorgan Chase & Co.
Why focus on young LMI workers?
Today’s young adult less financially well off than their parents were at the same age. From Young Invincibles ▪ Millennials earn $10,000 less than Baby Boomers at the same age. ▪ Millennials hold half the amount in assets than Baby Boomers at the same age. ▪ Millennials have half the net worth of Baby Boomers at the same age. Millennials in 2013 Baby Boomers in 1989 Income $40,581 $50,910 Total Assets $29,350 $61,277 Net Worth $10,900 $23,035 Allison (January 2017) Financial Health of Young America .
Young adults often struggle more with finances than older adults. From FINRA Financial Capability Study Challenges: 5 “ People have really foundational challenges ▪ Not planning ahead as around their finances. much Budgeting, managing money ▪ Less likely to utilize day to day. If you want to help formal financial products someone prepare for ▪ retirement, you have to start Exhibiting lower levels of financial literacy with those foundational issues .” -- Vishal Jain, Prudential Financial Gary R. Mottola, “ The Financial Capability of Young Adults — A Generational View ,” FINRA Investor Education Foundation, March 2014,
Young workers are more likely than older workers to report that finances affect their work. From PwC Survey Dealing w/ Finances Productivity Missed Work Financial Distract Work Impacted by Due to Stress Finances Finances Millennials 64% 37% 25% 12% Gen X 56% 29% 16% 8% Baby Boomer 40% 19% 11% 4% “Employee Financial Wellness Survey,” PwC, April 2016, http://www.pwc.com/us/en/private-company- services/publications/assets/pwc-2016-employee-wellness-survey.pdf
Study Overview: Interviews with Young Workers 49 Young, LMI Workers Interviewed in 4 Cities
Topics Discussed ▪ Financial issues experiences ▪ State of help with finances ▪ How employers can help ▪ View of workplace financial wellness services
What’s going on in the financial lives of young LMI workers?
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