We talked to Borja Perez at CloudPay, who speaks to the future of financial wellness benefits and what trends employers can expect in 2025.

Q: Why is it important to include financial wellness in a company's offerings?

A: Job seekers are not only asking for financial wellness benefits – they're expecting them. Employees are in search of work environments that will support their financial wellbeing by reducing stress and improving their overall health.

Many employers are recognizing this employee demand and integrating financial wellness benefits into their compensation offerings to better recruit top talent and remain competitive as a business. For employers in industries with more niche talent pools, financial wellness is a benefit that could be the difference between gaining or losing a high quality candidate.

The plus for employers who offer financial wellness programs is a more motivated, productive and less stressed workforce. This increases retention and productivity rates and reduces the number of days employees take leave for stress-related reasons.

Nearly half of employers plan to offer financial wellness benefits by 2026 and those who don't will feel the impact from lagging behind."

Q:   What specific offerings should employers offer their employees?

A: Employers who are ready to offer financial wellness benefits to their employees need to be offering earned wage access (EWA), also known as on-demand pay. This benefit is popular in many European countries and adoption rates are on the rise with U.S. employers. EWA allows employees to access their earnings instantly without having to wait for a designated payday or pay any additional fees. This gives employees ultimate flexibility to access money they've already earned, without being bound to a traditional paycheck cycle.

Flexibility has always been the appeal to on-demand pay solutions. Employees who use the benefit typically withdraw between $85 and $135 and make 2-5 withdrawals per month, according to CloudPay customer data. This suggests that most employees use EWA towards supporting their daily expenses, and aren't emptying their accounts. CloudPay data found that withdrawals were made from employees ranging from 20-53 years and the average EWA user is 42% Gen Z, 41% millennials, and 14% Gen X.

Employers should be offering a comprehensive package of wellness offerings to employees. This is a one-stop-shop for everything an employee needs to show up to work physically and mentally well. This can look like a platform where workers have access to articles to enhance their financial knowledge on how to plan for retirement or learn how to qualify for a mortgage. This can also be a hub for stress management tools including yoga or guided meditations. It can even include resources on how to improve physical health with fitness videos and nutritional meal planning.

Financial wellness offerings should be easily accessible to employees. Employers can offer this by consolidating benefits into a mobile app where workers can access their pay slips and documents, financial education resources, and on-demand pay services in one place.

Q:  What financial wellness trends can we expect in 2025?

A: No. 1: True EWA will continue to be adopted by more U.S. businesses in 2025. Because not all U.S. employers offer EWA, employees are going to third party organizations that offer payday loans disguised as EWA. Workers are being charged excessive fees to access their own earnings. Moving forward, we can expect this narrative to change as U.S. employers adopt traditional EWA models. This is a fully employer-sponsored benefit and there are no additional fees for the employee. It's not a question of if EWA will popularize with U.S. businesses, but when.

There are still legislative hurdles to overcome before the U.S. will fully embrace EWA. The Consumer Financial Protection Bureau and the American Fintech Council are two of the biggest entities behind EWA decision making. States are divided over the issue with some working to classify EWA as a loan. We can expect to see more states join the conversation as we move into 2025.

No. 2: Financial wellness tools offered in conjunction with financial education. Financial knowledge has been known to lead to better decision-making. By offering financial wellness courses and resources, businesses empower employees to have more control over their finances. Teaching employees how to manage their finances is key to keeping their financial stress reduced long-term, leading to better business outcomes.

No. 3: Job seekers will ask for more financial wellness benefits. As candidates and employees become more educated on the advantages of financial wellness benefits, they will look for employers who offer those tools and become more selective in where they choose to work. Businesses that lack financial wellness programs will be passed over by job seekers searching for their next role. Current employees may also leave a workplace to look for an organization that will support their financial wellbeing.

Q:  How is financial wellness connected to mental wellness?

A: Financial difficulties often lead to stress, and stressed employees are unhappy and often burnt out. There's a vicious cycle between money problems worsening mental health and mental health worsening work performance. This is why financial wellness is also mental wellness – you can't separate one from the other. They go hand-in-hand in supporting an employee's overall mental wellbeing to ensure that they are in the best state to come to work confident and fully-performing.

Uncertain or challenging economic times can add further stress for employees struggling to manage their finances. Organizations that offer supplemental support such as flexible and modern payroll options can help employees to feel confident that they can face financial struggles due to the wider economic climate. This provides workers with the peace of mind that they can handle unexpected expenses and won't have to rely on loans or overdraft fees.

Q: How specifically can employers offer financial wellness that supports employees saving for retirement?

A: Employers can support employees in saving for retirement by integrating financial wellness tools that offer both practical and educational resources:

On-demand pay / earned wage access: While EWA is often seen as a tool for managing immediate expenses, it can also play a strategic role in retirement planning. By alleviating short-term financial pressures, employees can be in a better position to contribute more consistently to retirement funds. This benefit empowers employees to make timely decisions about savings without the stress of living paycheck to paycheck.

Financial education and planning resources: Employers can offer comprehensive financial education programs that include retirement planning. This can encompass workshops, webinars, and personalized tools that educate employees on topics such as compound interest, investment options, and optimizing contributions to retirement accounts. Educating employees on how to set and achieve retirement goals can lead to greater financial security.

Automated savings programs: Integrating automated savings options within payroll platforms can encourage employees to regularly contribute to their retirement accounts. Employers can offer tools that allow employees to set specific savings goals and automate contributions directly from their earnings, making saving for retirement seamless and habitual.

Matching contributions and financial incentives: Employers can boost retirement savings by offering matching contributions to employee retirement plans, such as 401(k) or pension plans. This not only incentivizes saving but also enhances the overall financial wellness package, demonstrating the employer's commitment to long-term employee financial health.

Related: The most effective financial wellness programs? Tools, education & one-on-one counseling

Access to financial advisors: Providing access to financial advisors or retirement planning specialists can give employees tailored advice and confidence in their retirement strategies. Personalized guidance helps employees make informed decisions about saving, investment choices, and adjusting their retirement plans over time."

Q: What kind of financial wellness are employees and job seekers looking for?

A: Job seekers and employees are looking for financial wellness benefits including EWA and financial education. Workers want fiscal flexibility, easy access to their earnings, and to learn how to manage their finances for future prosperity.