It appears to be a resounding ‘yes’ as organizations support financial literacy initiatives to drive better health outcomes. There’s a direct relationship between our financial health and our overall wellbeing; stress about money can take a drastic toll on mental health and debt can force people to forego necessary health care and medications. Aware of the importance of strong financial health on health outcomes, organizations are putting their money where their mouth is, and employers are exploring financial health benefit offerings.
Take a look at how some organizations are enhancing health outcomes by empowering their people to develop greater financial literacy (the precursor to strong financial health):
- Kaiser Permanente & Change Machine – Kaiser made a $2.5M investment in Change Machine, a non-profit that provides financial coaching to individuals living in low-income communities. Assisting community members with debt, taxes, budget management, and navigating impacts to benefits due to income changes can lessen financial obstacles that have negative effects on health outcomes. While not intended to be a part of Kaiser’s commercial health plans (for now), the investments will strategically align with Kaiser service areas. This is just another example of health payers looking to address an array of social determinants of health, understanding that gaps in financial literacy and other socioeconomic factors can significantly impact health.
- EY’s Financial Literacy Summer Camp – It’s never too early to learn financial literacy skills. EY understands the lasting impact that good and bad financial decisions made early on can have, so they are rolling out a 16-week financial education summer camp to offer to their employees’ children focused on various topics tailored to different age groups.
- Financial Planning & Inclusivity – New research shows members of the LGBTQ community feel particularly less prepared for retirement and less knowledgeable on investing and estate planning. Two-thirds of LGBTQ adults live paycheck to paycheck and that number jumps to 72% for Black LGBTQ members. Employers should take into account members’ unique financial obstacles and the specific financial stressors different groups experience when designing a benefit to support employees’ in preparing for a secure financial future.
The Big Picture
A conversation on financial health feels timely with Americans feeling the impacts of inflation. Average credit card debt in the US is $6,569, over 100 million Americans are saddled with health-related debt, and 44% of Americans claim they would be unable to cover an unplanned expense of $1,000. Significant debt forces people to make critical decisions about where and how to spend their money, which can lead to spending cuts on food and other essentials that influence health outcomes. While raising wages may be the most desired option, companies can explore benefits to support financial health and reap downstream impacts on health outcomes and costs as well.