Budgeting, borrowing and debt management can be intimidating topics to even the most experienced professionals. But according to Harvard finance professor Mihir Desai, teaching financial literacy to today’s workforce — especially millennials — is important.
In our most recent episode of the HR Break Room podcast, Desai, author of The Wisdom of Finance: Discovering Humanity in the World of Risk and Return, discussed why and what employers can do about it. Here are three takeaways from that conversation.
Most millennials are in debt
A recent PricewaterhouseCoopers report stated that 81% of college-educated millennials surveyed said they had at least one long-term debt. In the same survey, 54% expressed concern about how they will pay back student loans, with only 27% actively seeking professional assistance to do so. These numbers indicate a growing need for financial education among today’s largest working generation, whose members witnessed the Great Recession a decade ago — the nation’s worst economic disaster since the Great Depression of the 1930s.
Make your organization the go-to center
Offering financial education programs is an attractive perk to today’s top talent. Many of the brightest employees of this generation are eager to learn more about how they can better handle their finances. Whether they are paying back student loans, planning a wedding or preparing for their first child, understanding how to manage their income is going to be a huge priority them.
By offering employees workshops, lunch-and-learns or company retreats on the topic, you not only make your organization more attractive to talent, but you also win the loyalty of your workforce and build an even better employee experience.
Meet their needs head-on
Start by identifying the specific financial needs of your people. Hold department meetings or send surveys to learn their pressure points. Once you discover the most urgent areas, plan an event or create materials to address and assist those needs.
This could encompass a wide array of topics, including financial wellness, the power of savings through an employer, tax advantages, budgeting, and understanding 401(k) and retirement plans. Whether a series of seminars or a one-off class, any program geared toward their needs can generate outstanding loyalty.
As more young and in-debt employees enter the workforce, the more valuable and attractive such financial education will become. Offering your employees the opportunity to be financially more savvy than their peers could be the next step in ensuring your people are set up for long-term success.
Click here to listen to the HR Break Room podcast interview with Harvard professor Mihir Desai.
