Q: I supervise a mostly 20-something group of employees. I can’t help but notice from the conversations I overhear that many of them have money worries, like making ends meet, managing credit cards and paying back loans. Yet I am amazed at how little knowledge they have about basics like budgeting, and how financing works.
Being a couple of decades older than the group I feel like I should educate them. What’s the best way to do that?
A: I consider financial literacy a survival skill for our world. Making the wrong choices when young, such as taking on too much debt, spending by the seat of your pants or leasing when you could buy because you didn’t know better, can truly set you back.
It may take years to undue damage that could have been prevented. Unfortunately your rookies have lots of company in their blissful ignorance. According to the non-profit Financial Industry Regulatory Authority FINRA.org, “61 percent of respondents were unable to answer more than three of the five questions correctly” on their Financial Literacy Quiz. (available on their website)
But even though your sentiment is laudable -and needed- I don’t recommend you try to educate workers yourself. Why? Money is personal, and emotional – it would complicate the employment relationship in ways you can’t anticipate- so don’t.
What you could do instead in ask the company to arrange some type of training on financial literacy and offer that (on a voluntary basis) to your employees, as a perk, at no cost.
Some companies even offer financial wellness support as part of their benefits package, -similar to offering legal assistance. That’s smart because in the long run, the company benefits from less stressed more focused employees.
According to a 2018 survey by PwC, about a third of employee say they are distracted by problems with their personal financing.
Where to find this training? There are lots of free or almost free stuff available, a good source is financialeducatorscouncil.org Another route is to ask a local bank or credit union to partner with your company. They get to meet potential new customers and your employees get to learn how to manage their money and not make rookie financial mistakes.
©Copyright Eva Del Rio
Eva Del Rio is creator of HR Box™ – tools for small businesses and startups. Send questions to Eva@evadelrio.com