Friday, April 12, 2024

Fresh benefits may ease financial stress in the workplace

By Barbara Wood

I recently read a report in USA Today that said one-in-four American workers are seriously distressed about their personal financial situation. That 80 percent of financially stressed workers spend time at their jobs dealing with or worrying about money issues. The bad news for business owners?

Stress can directly affect employee job performance—lowering productivity due to absenteeism and lack of focus, as well as physical issues such as high blood pressure, weight gain and insomnia. So what can you do to not only improve your employees’ lives but also increase productivity and loyalty?

Include some tools and resources in your employee benefits package to help reduce financial stress— and I’m not talking yoga or group counseling sessions. Focus on providing benefits that can directly improve your employees’ financial lives. Some things you might consider offering are: Access to a 24 hour nurse hotline, financial workshops, a financial wellness library in your break room, a prescription discount card or even the choice to work from home one day a week. If you’ve transitioned to a high deductible health plan (HDHP) like many other companies, it’s likely the most valuable perk you can add to your benefits package is a Health Savings Account (HSA) that will help employees save for those higher deductible levels and out-of-pocket healthcare-related expenses. What is a Health Savings Account (HSA)?

An HSA is a tax-favored* savings account regulated by Internal Revenue Service (IRS) guidelines. It helps individuals who are enrolled in a HDHP save for out-of-pocket health expenses such as medical bills, dental and vision care, prescriptions and medical supplies. What are the benefits? Both employers and employees enjoy tax-saving benefits* through HSA contributions.

Earnings grow tax-free and withdrawals from the account are not taxed when they’re used to pay for qualified medical expenses as defined by the IRS. Unlike other types of savings vehicles such as Flexible Spending Accounts, HSA funds rollover from one year to the next without penalty. Many consider this an opportunity to save for medical expenses they’ll incur during retirement, much like an Individual Retirement Account (IRA). Lastly, the account holder has the ability to pay medical expenses out-of-pocket and reimburse himself/herself at any time in the future with proper documentation.

HSA partners may be offered through your benefit broker or you can find one on your own. If you’re thinking about adding an HSA program, here are some important questions you should ask when shopping.

What is the HSA enrollment process for the business and its employees? Depending on your company’s size and whether your employees are located in one place or scattered throughout the country, options like on-site enrollment and online enrollment should be considered. Is there a cost to either the business and/or its employees? Ask about set-up fees, enrollment fees, and monthly service fees.

Weigh costs with value of the account features. Do your homework. There are good, free options out there! How easy is it for the business and/or employees to make contributions, withdrawals and manage balances? Look for providers that offer direct deposit options, debit cards, and free online account management services. What type of support is provided? Does the provider have a dedicated service team that can assist both you and your employees if questions arise?

While lowering financial stress isn’t part of your job description as a business owner, a holistic benefits package that provides employees with a greater sense of overall well-being can help you attract and retain top talent. Happy, healthy employees are more productive employees that contribute to your business’ success—and ultimately—to the bottom line.

Barbara Wood is a health savings account business development officer at Financial Center First Credit Union.

To learn more about the HSA program, contact Wood at (317) 916-6156 or visit Fcfcu.com/hsas-for-employers.

*For specific tax advice, consult a qualified tax professional.

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