man giving presentation on finances Companies are now helping employees to draw up detailed,personalized financial wellness plans. (Photo: Getty)

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Financial wellness programs are now offered by 53 percent offirms, which is double the number seen in 2015, according to aBank of America Merrill Lynch survey. Thisaugurs well for retirement readiness, because there is evidencethat workers who are engaged in a financial wellness programincrease their retirement contribution rates by 38 percent.Furthermore, employees who feel in charge of their financialwellness report having less stress, according to Questis research,which enables them to be more engaged in the workplace. Simply put, theyhave a plan and they aren't constantly waiting for the "other shoeto drop."

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Related: 6 ways employers are changing their approach toemployee financial health

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Yet, the focus on financial wellness is a relatively newphenomenon, one that is gaining traction as employees expect theiremployers to provide services to help them manage their overallfinancial picture. For decades, the financial education offered bycompanies was a mixture of carrot and stick. They remindedemployees to plan for their retirement and encouraged themto capture the full potential of their defined benefit pensionplan. But companies fell silent as defined contribution plans,which expose employees to savings and investment risks, replaceddefined benefit plans

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Employees saw dwindling engagement from their employers at theexact time they needed a helping hand, because their financialjourneys had become increasingly complex. Outstanding consumer debt has soared in recent years,surpassing the $4 trillion mark earlier this year. This mountain ofdebt, combined with higher health care costs, can overwhelmemployees of all income levels, affecting their performance andmorale. This is bad news for companies, because stressed employeesare less productive. This is why firms are now looking to do morethan simply set up 401(k)s and then tune out of the topic offinancial wellness. They are beginning to engage in the manner ofgood shepherds.

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Companies are now helping employees–whether they are recentmedical school graduates, middle-aged parents with a growing listof financial dependents, or retirement-age workers worrying aboutthe cost of pet insurance–to draw up detailed, personalizedfinancial wellness plans. This engagement consists of more thanregular videos on employee websites or biggest saver-stylecompetitions, although both are very useful for raising awarenessabout retirement readiness. Firms are increasingly rolling outworkshops, seminars, and counseling sessions that are tailored totheir employees' various demographics and financial situations,whether that is younger people budgeting, or older workers planningfor an ageing parent's care.

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Technology is increasingly playing a role in these initiatives.Some of the winners of the annual competition held by the J.P.Morgan-founded Financial Solutions Lab include fintech start-upsOnward and HoneyBee, which are both apps that help employees withdirect saving, emergency lending and financial literacy. TheQuestis platform uses features such as chat and personalizedgoal-setting that allows companies to communicate and engage aswell as educate. This is crucial, because struggling employees needmore than education: They require step-by-step instructions ondrawing up and executing a plan. BlackRock and Fidelity have alsopartnered with third parties that help employees with everythingfrom rounding up spending transactions to refinancing studentloans.

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Companies can also opt to build their own financial wellnessplatforms, and such initiatives do not need to be technologicallycomplex. For example, employees could be guided towards a mini sitewhen they are filling out their 401(k)s. The platform could allowworkers to enroll without extra passwords, enabling them to easilycheck their balances and benefits. The sites could provideresources such as retirement planning materials, quarterlystatements and online calculators. Some companies might choose toenhance their sites with guest articles from experts aboutdistribution options or investment advice.

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It is not just employees approaching retirement age that will benefit from suchinitiatives. Our recent study showed that 67 percent ofmillennials currently have some kind of a retirement savings plan,and almost half (49 percent) currently invest in a 401(k), 403(b),pension plan or similar program through their employer. But thestudy also showed something else: This generation has moreconfidence in savings accounts than other types of retirementsolutions. Around two in three millennials report they areconfident or very confident in savings accounts, while 58 percentare confident in workplace retirement plans like a 401(k).

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This mindset hints at a generation of around 83 million peoplethat can benefit from a technology-based financial wellnessplatform with a human touch. They are thinking about financialbalance but they desperately lack the knowledge and guidance to setthem up for success. Companies who want highly motivated employeeswith the greatest productivity should consider enhancing theirbenefits experience with these tools.

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The benefits of engagement are mutual. For example, Google saw a37 percent jump in employee satisfaction after boosting investmentin support for their workers. And after launching a student debtrefinancing program last year, one major asset manager saw a75 percent reduction in first-year employee turnoveramong employees participating in the student loan program. One intwo new hires also said the program was "a major factor" in theirdecision to join the firm. If companies seize the day on financialwellness, they can expect similar rewards.

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Cindy Dash is general manager and seniorvice president at Matrix Financial Solutions, Broadridge.

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