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Empowering Your Employees: Combating Financial Stress and Inflation with Valuable Benefits
By Burnham
Insights Article: Empowering Your Employees: Combating Financial Stress & Inflation with Benefits

Combating Financial Stress and Inflation with Valuable Benefits

The latest Stress in America™ survey by the American Psychological Association reveals that nearly 87% of Americans are currently experiencing financial stress.

The reasons are evident:

  • Food-at-home prices increased by 3.6% in July 2023 compared to the previous year.
  • Gas prices soared to $3.81 per gallon over the last 12 months.
  • Average rent for a two-bedroom apartment rose to $1,320 up from $1,282 per month last year.

In this challenging economic climate, employees find their paychecks stretched thin, leading to financial stress that can impact their productivity and well-being.

How can employers minimize the rising cost of living and maximize employees’ take-home pay?

Increasing salaries, adjusting for the cost of living, and offering bonuses can mitigate the effects of inflation on employees’ income, helping them cope with escalating prices for necessities like housing, gas, and groceries and alleviating financial stress. Nevertheless, growing operational costs for employers, such as health insurance and heating fuel, restrain their ability to raise salaries across the board significantly.

Fortunately, numerous employers already provide valuable financial benefits to their employees. The crucial step is to ensure that employees are aware of these benefits and understand how to maximize their usage.

The solution: communicating benefits

The answer lies in redirecting communication efforts toward highlighting all available benefits. In the current tough economic climate, HR leaders and benefits teams can assist employees in saving money and easing the financial burden they might be facing. Some of these benefits that deserve emphasis include:

  1. Employer Contributions to HSAs:For employees in a high deductible health plan (HDHP), these contributions can offset the amount they have to pay out-of-pocket for healthcare, one of the highest costs they have today. This year, the average annual employer contribution for Health Savings Accounts (HSA) is around $600 for individual employees ($1,250 for employee family plans).
  2. No- or Low-Cost Mental Health Support: Employee Assistance Programs (EAP) offer affordable access to stress management and mental health services, including free counseling sessions and financial coaching.
  3. Financial Benefits: Benefits like student loan assistance, childcare subsidies, and contributions to dependent care accounts ease financial burdens and mitigate the impact of inflation.
  4. Fitness Benefits: Gym memberships, exercise classes, and digital wellness apps motivate employees to maintain good health, potentially reducing healthcare costs.
  5. Digital wellness apps. Encouraging healthy lifestyles for employees and monitoring wellness activities, can allow employees to earn financial rewards which, in some cases, can be added to their paychecks throughout the year.
  6. Greater Access to No-Cost, High-Value Benefits: Benefits such as flexible work schedules and discount programs lower the cost of living, demonstrating employer sensitivity to employee needs.
  7. Work-from-Home Arrangements: Remote work reduces commuting expenses, putting more money in employees’ pockets, especially in light of recent price hikes in transportation costs.
  8. Educational Tools and Resources: Financial planning calculators and online webinars help employees understand how to manage their finances effectively during challenging times.
  9. Relevant Employment Policies: Allowing employees time off to address financial issues reduces their stress levels and enhances overall well-being.

Next Steps

In these times of financial uncertainty, employees seek stability and support. By reassessing your benefits program and ensuring it aligns with employees’ current needs, you can provide valuable assistance during these challenging times. Contact us to explore how we can collaborate and empower your workforce.

This material has been prepared for informational purposes only. BRP Group, Inc. and its affiliates, do not provide tax, legal or accounting advice. Please consult with your tax, legal, or accounting professionals before engaging in any transaction.