Using Financial Wellness Offerings to Boost Employee Retention

For a good reason, financial wellness programs are booming in the workplace. Studies show that when a company offers employees access to reliable, affordable financial services, it positively affects employee retention. In an increasingly digital and connected world, employees need access to more than just basic financial services — they need access to the right financial services at the right price points. Financial wellness programs can ensure this by offering accessible savings options and loan products that target their specific needs. This article will focus on the benefits of employee financial wellness programs in South Africa and how they can help retain employees.

What are financial wellness programs?

Financial wellness programs (FWHPs) are an addition to standard employee benefits and go beyond retirement planning and investing information. It promotes the accurate understanding and proper application of money to maximise the likelihood that the employee will develop a healthy relationship with their money and establish stable, fulfilling, and satisfying personal finance scenarios at home and work, now and in the future. 

In South Africa, employers can provide various financial wellness programs to employees. Employers can give access to financial wellness programs through your payroll provider, through an employer-specific program, or as part of a corporate wellness program. 

There are a few key things you should keep in mind when deciding what type of financial wellness programs your company should offer to employees. First, you should assess what benefits employees are asking for. Next, you should determine which financial wellness provider your company can afford to partner with. Like all benefits, they come at a cost. Finally, it would be best if you determined whether your business can effectively market and distribute financial wellness programs to employees. These considerations will primarily affect the type of program you decide to offer.

The benefits of financial wellness programs

Increased savings rate

When employees have access to reliable financial products, like low-interest savings accounts and access to credit, they’re more likely to save for retirement. This can help improve your company’s financial health and increase its long-term viability.

Reduced risk of financial stress

Financial wellness programs can help employees manage their finances and avoid financial stress. Providing low-interest products and affordable access to credit can help them avoid risky behaviours that could affect their credit ratings and cause them to lose valuable benefits, like health care or retirement benefits.

Increased future earning potential

Financial wellness programs can help increase employees’ earning potential by providing access to various financial products and services, like credit. These include car loans to mortgages, which can help employees boost their net worth and unlock economic opportunities that could help them with future financial goals.

Why is it so important to retain employees?

Employees with access to reliable, affordable financial products are more likely to stay with your company. This can help boost your financial health and increase the long-term viability of your business. It can also help reduce the risk of financial stress in employees’ lives, like the feeling of economic pressure from paying unexpected costs like medical bills. For employees with access to reliable financial products, this financial stress is less likely to impact their day-to-day lives. Instead, it’s expected to cause them to seek help from their employer, like a company’s financial wellness program.

The three ways a financial wellness program boosts retention rates

Employee retention is vital to the overall health of any business, both in terms of profits and stability. Studies show that employees are more likely to stay on the job when a company offers access to reliable financial products. That means the benefits of providing financial wellness programs to your employees include the following: 

  1. Lower healthcare costs – A growing number of employers are offering their employees health savings accounts (HSAs). These accounts offer tax-free savings that can help cover out-of-pocket medical expenses. 
  2. Reduced risk of financial stress – Providing employees with low-interest products and affordable access to credit can help them avoid risky behaviours that could affect their credit ratings and cause them to lose valuable benefits, like health care or retirement benefits. 
  3. Increased future earning potential – Providing employees with access to a range of financial products and services, like credit, can help boost their net worth and unlock economic opportunities that could help them with future financial goals.


The internet and the rise of digital technologies have made it easier for employees to manage their finances. However, it’s still vital for them to have access to reliable financial products. That’s where financial wellness programs come in. FWHPs can help boost employee retention, improve a company’s financial health, and help employees manage their finances by providing access to various financial products and services, like credit.

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Help Employees Set Their Budgets and Help Your Business Grow

As an employer, one of your key roles is to help your employees develop their unique strengths and interests within their respective roles. An additional part of prioritising is to assist employees in setting personal financial goals and developing relevant plans to help you and your employees stay focused and on track.

Regularly assisting employees set goals builds their engagement with you as an employer and boosts their productivity.

To reap the rewards of assisting employees, here are some ways employers can help employees create a fully comprehensive budget for 2022 and improve their financial literacy.

Show employees how they can have an impact.

Very few of us can afford a large financial purchase with a once-off payment, nor can we operate in today’s economic climate without keeping our spending in check. For reasons like these, we need to help employees figure out how they can achieve their financial objectives. They can do this by creating a budget (a financial roadmap) to tell them where they started, where they are, and where they are going. 

SmartAdvance informs employees that the budget tells us if we can afford to buy wish list items or if we need that money to cover fixed expenses. It also helps us achieve financial freedom by saving for a financially healthy retirement and helps to prepare for potential emergencies.

Putting a personal budget in place helps create some sense of financial stability and can be implemented by following the below simple steps:

Step 1: Know where you are

It is essential that you write down the following; how much and how often does your money come in, and how often are you spending. The more comprehensive this list is, the more effective your budget will be. 

Step 2: Categories

Both income and expenses can be fixed or variable and regular or irregular. Separate your income and expenses into the respective categories. 

Step 3: Capture

Capture all your Budgeted income and expenses onto a spreadsheet/template. Remember to separate them into fixed, variable, regular and irregular income and expenses.

Step 4: Calculate budgeted amounts

Having the total amount of your income and expenses will enable you to calculate what you will have left or not be able to pay at the end of the budgeted period. This helps you understand what you can or cannot afford, where you can save money and what is happening to your money.

Step 5: Record and monitor actual amounts

Monitor your actual expenses for the period in question. You will need to separate your expenses into various categories at the end of the period to calculate how much you spent. This total is then captured under the actual column on your budget spreadsheet/template.

Step 6: Calculate variance (difference)

Calculate the difference between your budgeted amount and the actual amount for each income and expense category. This difference is called the “variance”. There are only three outcomes to this calculation. You have little to no variance, negative, or positive variance.

Step 7: Update and repeat

Repeat the process the next time.

Employers should refrain from creating goals for employees. They can dictate the objective but not the goal. It’s best if employees come up with the goals themselves.

Help employees reach their goals.

When you partner with SmartAdvance, you assist your employees in setting their budget, and we take them through the process step by step. 

For employees to successfully implement a budget, they must articulate what they hope to achieve with their budget so that we can assist them in setting SMART goals to make creating a successful budget possible. 

Employees need to understand that these goals are for themselves and not solely to improve their productivity at work. Employees need to know what’s in it for them, so we discuss the below with them:

  • How the goal impacts them personally.
  • How the goal aligns with their passions and career path.
  • The knowledge and skills they can develop while pursuing the goal.

Helping them helps you.

Succeeding as an organisation requires business skills, decision-making, and, most importantly, happy employees. Employees need to perform within the organisation and create value. In return, a company should assist them with essential matters such as budgeting and financial wellness. 

Budgeting is one of the essential skills to master. This requires a company to partner with a financial wellness provider that can provide training programs that equip employees with the financial literacy needed to address their changing financial needs. Implementing employee wellness programs that encompass benefits – such as financial training and financial assistance – is excellent for recruitment and employee retention and translates into crucial metrics such as improving productivity and profits.

Not only does it help you improve productivity, but more importantly, it has a positive impact on company morale which has become a central focal point for employers in this post-pandemic world. Employees who have access to financial wellness benefits are more likely to have high confidence than those who don’t. Employers who offer such solutions to their teams have employees who report less stress.

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How SmartAdvance Boosts Employee Financial Wellness

Covid-19 has impacted the way that many employers approach employee wellbeing. Businesses have started to reconsider the importance they place on the financial wellbeing of their employees after the significant financial strain they have been placed under for the past year and a half. Financial wellbeing programs are no longer an added benefit but a necessity for an engaged and productive workforce. 

To put this is context, 89% of employees in South Africa are concerned about their ability to pay their bills. Additionally, 80% of employees are unable to make it to the end of the month. The level of stress these places employees under is monumental and minimizes their ability to prioritise anything other than survival. Ultimately this results in 20% of employee absenteeism being a result of financial stress. Figures like these severely decrease company revenue because of the decline in overall productivity. 

Not having a financial wellness program means as an employer you are spending a significant portion of your workday on time consuming admin. Worse, it means employees do not have access to financial protection and insurance which prevents them from becoming over-indebted and going to unreliable credit providers. Ultimately what this leads to is a workforce that is snowed under by financial stress which adversely affects their productivity. 

Partnering with a financial wellness provider such as SmartAdvance helps you oversee the entire employee wellness journey which includes everything from payroll services to developmental credit.

SmartAdvance provides a holistic employee wellness solution:

Payroll services

Finclusion has recently announced the acquisition of a strategic stake in HelloHR, a South African payroll software startup. What this means for SmartAdvance clients is that they now have access to a holistic financial wellness product. This acquisition grants SmartAdvance clients access to payroll services which includes the automation of the necessary leave and tax adjustments. Meaning that clients save time and reduce the chance of human error.

Wage streaming

This allows employees to access to a small portion of their earned wages at an earlier date. This gives employees a responsible alternative to taking out a loan from a unreliable lender by giving them the more the option of access to their own wages at an affordable flat rate.

Rehabilitation loans

Give employees the opportunity to improve their credit rating by giving them access to rehabilitation loans. They have the option of getting a loan of up to R50 000 over 36 months so that they can improve credit rating and improve monthly savings.

Developmental credit

Your employees have access to developmental credit which helps them build, expand or improve low-cost housing, thereby helping them improve the community in which they find themselves. 

Behind the Scenes

Making all of this possible is the amazing SmartAdvance team that is supported by the Country Head, Gerrie Fourie.

Gerrie spent almost 10 years starting and managing various finance companies throughout Africa. He started his journey with the Finclusion Group in June 2020, ultimately taking on the role of SmartAdvance Country Head in April 2020.

He was brought in to oversee the successful implementation and managing of all SmartAdvance operations. 

Currently he is tasked with aligning the SmartAdvance strategy with that of the Finclusion Group. This strategy alignment is vital as they have recently received funding and now the responsibility is on him to deploy it and guarantee it is dispersed to the necessary departments.

“Business development is a top priority, because we cannot afford to not move forward. Just because we are successful today does not guarantee it tomorrow.”

Forward momentum is also driven by strategic partnerships, which Gerrie helps forge and nurture. 

“If you want to increase your expertise and resources, create predictable revenue streams and provide incremental lift to sales and revenue, all while keeping acquisition costs down then your ability to solidify strategic partnerships is priceless.”

Day-to-day he is responsible for SmartAdvance’s staff management and reporting. Staff management is a lot easier as face-to-face communication is possible once again as more employees are returning to the office as lockdown regulations are eased.

He is trying to ease the transition back to the office by aligning company culture with the long-term goals of employees and SmartAdvance. He has also busy with tech enhancements which will greatly benefit the success of his employees.

If you are ready to looking after the wellbeing of your employees, get in touch with us to discuss partnering with SmartAdvance.

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Financial Well-Being in the Workplace

Money concerns is not a topic that employees like to discuss at work, so it may not be apparent to an employer when their employees experience financial distress.

Employers can take the time and effort to identify when money concerns affect their employees, so that they can offer resources to help.

Signs of Financial Distress

Even though employees seldomly disclose when they are in financial distress, below are signs that could indicate that an employee could use assistance:

  • Requesting an advance on a paycheck
  • Being mentally distracted during work
  • Spending more time on phone calls
  • Showing up late or other attendance issues
  • Avoiding social occasions with co-workers, such as going out to lunch
  • Choosing not to participate in a retirement plan

Four Elements of Financial Well-Being

Financial well-being comes when people feel secure about their money and that they have the freedom to spend their money how they’d like. Individuals should review their financial well-being from four different perspectives:

1. Feeling In Control of Daily and Monthly Finances

A key aspect to feeling financially secure having enough financial resources to meet your day-to-day and month-to-month expenses. The focus here is on meeting your present expenses. This keeps you in control of your expenses, rather than expenses being in control of you.

2. Capacity To Absorb a Financial Shock

Life is full of unforeseen circumstances and part of your financial well-being is having enough financial resources to absorb the costs of such circumstances. 

With this element the focus of financial well-being shifts from being able to control your present expenses to focusing on the future and emphasizes the ability to cover emergencies. 

Emergencies pose great threat to a person’s financial stability and therefore needs to be adequately planned for.

3. On Track to Meet Financial Goals

Another important aspect of financial well-being is to be on track to meet your financial goals. Achieving financial wellness means you do not derail from the goals and targets that you set for yourself. 

Once you have achieved your short-term goals, like establishing a budget or creating an emergency fund, you should start working toward mid-term financial goals such as, paying off student loans. Lastly you want to concentrate on achieving long-term financial goals such as striving for homeownership or increasing your retirement savings.

You probably won’t make perfect, linear progress toward achieving any of your goals, but the important thing is not to be perfect but to be consistent.

4. Financial Freedom to Make Choices to Enjoy Life

The final aspect of financial well-being is having the freedom to make choices regarding the use of your financial resources to enjoy life. Amanda of Dream beyond Debt, captured this fact by defining financial security as “the ability to spend money on what I want, and not on what’s available or what I can get the lowest price because that’s all I can afford”.

Financial Freedom is about living within your means, being a bit frugal, and making sure that money is spent on things you really need like food, shelter, and even vacations (relaxation is important too).

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Financial Wellness Programs

Being aware of the signals when an employee is in financial distress and knowing what the different elements of financial well-being are, is not enough to support your employees.

There are measures that you can put in place to achieve this, namely, creating an employee financial wellness program. This is a program to help employees better manage their finances and reduce financial worries. In any financial wellness program offered to your employees (of all income levels) there are 5 key areas to focus on:

Budgeting and Spending 

Stress the importance to your employees of tracking, spending and planning what you will spend via a budget. It is important for them to remember that their projected and actual spending may not match exactly, but they should have a goal and monitor where their money is going.

Emergency Funds

You can help your employees understand that besides ordinary expenses, there are always emergencies that pop up here and there, some major some small. They should be disciplined in saving for such unexpected events. Recommend to your employees that they should save the equivalent of three to six months of your typical salary.

Financial Counselling

When it comes to buying a car, house, or any major purchase (especially one that requires going into debt), it is wise for your employees to get expert advice. They should preferably get 2 or 3 experienced opinions before making a final decision.

Investment Strategies 

Further, explain to your employees if they already have their day-to-day finances under control and have a sufficient amount of money saved, they can do well by investing any surplus funds. You can offer recommendations on how to invest for instance, it’s best to choose stable, low-risk investments rather than risk a big chunk of your “life savings”. They should look for investments that are almost sure to pay a respectable dividend, even that means waiting longer to receive it.

Improving the financial well-being of your employees’ matters not only because it will decrease employee absenteeism, presenteeism and increase their productivity but also improve the overall quality of life for your employees.

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