Savings at Work: A Guide to Measuring the Success of Your Financial Benefits
Savings at Work: A Guide to Measuring the Success of Your Financial Benefits
Providing a thoughtful financial workplace benefits package is one of the most meaningful ways to support your employees. But, how do you know if those offerings are truly making an impact?
As employee needs and expectations evolve, it’s important to regularly assess your financial benefits package to make sure it’s delivering real value. Whether you’ve recently launched new financial benefits or have offered the same ones for years, ongoing evaluation can help you understand what’s working, where there may be gaps, and how to improve moving forward.
In this guide, we’ll walk through how to measure the success of your business’s financial wellness benefits and make informed decisions that help your team and your business thrive. Let’s dive in.
Why Measurement Matters
Over 75% of employees are stressed about their finances, impacting their productivity, engagement, and overall well-being both at work and at home. When well-designed and fully utilized by your team, a holistic workplace benefits package can be a true game changer for your business. It can help you:
- Attract and retain top talent
- Foster a more engaged, productive, and satisfied workforce
- Build a strong company culture
- Support employee financial stability
But if your financial benefits aren’t aligned with your team’s evolving needs, you could be missing out on these advantages. Regular evaluation is essential to maximizing your return on investment and verifying that your offerings are resonating with your workforce.
Four Ways to Measure the Impact of Your Financial Benefits
Here are four strategies to assess whether your financial benefits are delivering value to your employees and your business.
1. Review Participation and Engagement Metrics
Start by analyzing how your current benefits are being used. These metrics can offer early insight into what your team is valuing.
Participation Rates
Of eligible employees, what percentage are participating in the benefit?
Have participation rates changed since you first introduced the benefit?
On average, businesses see a participation rate of around 80-90% of eligible employees in their 401(k) retirement plan.
Contribution Levels
What is the average contribution rate among your employees?
Are employees contributing enough to get the full employer match, if you offer one?
Employee 401(k) retirement plan contribution rates are, on average, around 8%.
Withdrawals
Are employees tapping into their retirement plans early through loans or hardship withdrawals?
Have retirement plan withdrawals increased over time?
On average, about 1-2% of employees take hardship withdrawals from their 401(k) retirement plan.
2. Monitor Recruiting and Retention Metrics
Your financial benefits don’t just support your current employees; they’re also a key part of your talent strategy. By taking a closer look at how your recruiting and retention metrics stack up, you may be able to draw some meaningful conclusions about your benefits performance.
Offer Acceptance Rates
Have offer acceptance rates improved since modifying your benefits?
Are candidates citing your benefits package as a reason for accepting the offer?
Are candidates attempting to negotiate for more?
A high offer acceptance rate in recruiting is generally considered to be 90% or higher, with averages around 80-90%.
Retention and Turnover
Have turnover rates improved since launching new financial benefits?
While dependent on industry and job role, turnover rates on average are around 10.6%.
Exit Interviews
What are departing employees saying about your benefits?
Are there common suggestions or concerns?
3. Gather Employee Feedback
Your employees’ goals and needs are constantly shifting, and your benefits should be dynamic to match them. Regular feedback from your employees is a great way to measure the success of your financial benefits.
Annual Surveys
Prepare an anonymous annual survey that can help you spot changes in employees’ financial priorities. Consider asking questions about your employees’ current needs, priorities, and life changes. Suggestion boxes can also allow employees to share their thoughts candidly.
Manager Feedback
Encourage managers to have informal conversations with their teams about what’s working and what’s missing from your financial benefits package. Provide managers with a forum to submit feedback they receive.
4. Adapt As Your Workforce Changes
Your team won’t stay the same, and neither should your financial benefits. As your team grows or shifts, it’s important to think through how you can adjust your offerings for new employees. Here are some considerations:
- What are the age demographics of your newer employees? A younger workforce may be focused on paying off student debt, building emergency savings, or saving for future education expenses. In contrast, more tenured employees may prioritize maximizing retirement contributions or supporting dependents through college savings.
- What roles are you hiring new employees for? If you’re hiring for roles that require advanced education or certifications, student loan repayment assistance or education savings benefits may be particularly valuable. For entry-level or hourly positions, benefits like emergency savings accounts or non-elective retirement contributions can help support financial stability and encourage saving.
- Are your new employees experiencing income volatility? If your workforce includes seasonal, gig, or commission-based roles, emergency savings benefits or flexible contribution features may be especially valuable. These tools can help employees build financial stability even when their income isn’t consistent.
Improving Your Benefits Strategy: Next Steps After Evaluation
If your evaluation reveals low engagement, gaps, or missed opportunities, here are some next steps to consider.
Enhance Employer Incentives
Boosting engagement often starts with stronger incentives. For retirement plans, consider offering a non-elective contribution, where the employer contributes regardless of whether the employee participates. This can help spark initial interest and reinforce your long-term commitment to employee financial well-being.
For short-term savings, consider adding milestone rewards to Emergency Savings Accounts (ESAs). For example, you might offer a $100 bonus when an employee reaches $1,000 in savings. These small rewards can help employees build momentum, celebrate progress, and stay motivated to reach their goals.
Educate Your Team
Employees may not fully understand the long-term value of the benefits available to them. Provide clear, accessible education, such as workshops, webinars, or visual resources, to explain topics like compound interest, retirement plan matching, or debt-repayment strategies. Some benefit providers offer ready-to-use educational tools that can help increase engagement.
Make Savings Automatic
Decision fatigue is real for employees—between choosing health plans, managing PTO, and navigating everyday finances, benefits decisions can fall by the wayside. Auto-enrollment and auto-escalation features simplify the process by making participation the default and gradually increasing contributions over time, helping employees save more with less effort.
Address Short-Term Needs
If you’re seeing frequent loans or hardship withdrawals from retirement accounts, your employees may need more immediate financial support. Consider adding an ESA to help employees build a safety net. Similarly, if you have a younger workforce facing student debt, offering student loan repayment assistance or matching could provide meaningful relief while encouraging long-term savings.
Test New Benefits
Pilot new offerings based on the feedback and data you’ve collected. Start small—you might be able to introduce a new benefit to a specific team, department, or new hires first, allowing you to evaluate interest, gather feedback, and fine-tune your approach before expanding company-wide.
How often should I evaluate my benefits?
Aim to thoroughly evaluate your benefits at least once a year. If you want to target January 1 for potential new benefits, consider conducting this review in the early fall so you have plenty of time to assess results, explore new benefit options, and implement changes.
Get the Most Out of Your Financial Benefits Package
Your financial benefits package plays a critical role in supporting your employees’ financial wellness and your business’s long-term success. By regularly measuring what’s working, listening to employee feedback, and adjusting your offerings to match evolving needs, your benefits will remain impactful, inclusive, and aligned with your goals.
Whether you’re refining your current strategy or exploring new savings solutions, Vestwell is here to help you deliver benefits that make a difference for every employee, at every stage of their financial journey.
