Financial literacy for employees—why it matters for your business?

As a company manager, you pay your employees a salary. And you might think that’s where your responsibility for their financial well-being ends. But actually, there is more you can do. Both employees and the company benefit when employees are not only well paid but also financially literate.

Financial literacy

The ability to understand and effectively use various financial skills, including personal budgeting, saving, investing, and managing debt.

Financial literacy for employees is becoming a critical pillar of a successful workplace. While traditionally viewed as a personal responsibility, employee financial literacy now plays a role in your company’s performance. 

The truth is, financial stress doesn’t just affect individual well-being. “This stress doesn’t stay at home—it walks through the office doors every morning, impacting focus, productivity, and even retention,” writes Ana Mahony, Founder and CEO of Addition Wealth for the World Economic Forum.

According to a study by PwC, for 57% of employees, finances are the top cause of stress in their lives. As an employer, you can help reduce this stress about one’s finances—and that doesn’t necessarily mean increasing their salaries. It’s about teaching them to manage the money they already have in a way that makes them feel more financially secure.

The financial literacy gap is serious

Employee financial illiteracy is a serious issue. Globally, only 27% of adults are considered financially literate in 2025, while the rest lack knowledge on how to manage their money and thus suffer from constant stress. 

In the US—one of the world’s largest economies—30% of adults report living paycheck to paycheck and not having a budget. 

Financial literacy for employees is essential because it directly affects their daily life and job performance. According to SHRM, 80% of employers admit that financial stress is negatively impacting their employees’ performance level. That’s costing companies nearly half a trillion US dollars annually.

A lack of knowledge about how to manage personal finances also drives employee turnover. Many choose to quit—not because they dislike their jobs, but because they believe a higher-paying role will ease their financial stress. However, the relief is often only temporary—you just have more money to spend incautiously. Soon, employees may find themselves stuck in the same cycle of stress, regardless of how much they earn.

Financial literacy for employees—what can you do as an employer?

If you have never had a program for employee financial literacy at your company, start one step at a time.

First, you may want to launch a survey to understand your team’s understanding of basic financial concepts, as well as their biggest financial concerns. What is it that they are most stressed about? Is that their debt? Budgeting? Retirement plans? Once you know this, you will be able to offer them training that best fits their needs.

Consider inviting experts for lectures and workshops on financial literacy for employees. Perhaps you can agree with your bank to send their personal finances consultant to deliver a lecture—many banks are more than happy to provide educational content at no cost, in return for the opportunity to promote their investment plans and other services.

Sponsor online courses—via platforms like Coursera, Udemy, or Skillshare. There, you can find targeted courses on a range of financial topics, from everyday budgeting to investing and debt management. Some may prefer online learning over in-person lectures, as it allows them to delve more in-depth and at their own pace.

Additionally, you may want to start some short, ongoing internal resources—such as a monthly newsletter for employees—that keeps financial literacy visible and on top of people’s minds. Use this resource to share the latest investment news, saving tips, or recommend online tools to help people manage their finances better.

The benefits of improving employee financial literacy

Workplace-wide financial literacy is beneficial for everyone. When employees feel financially stable and informed, they work…well, better. 

Here are the key benefits you can expect if you introduce financial literacy training at your company:

Increased productivity.

Employees spend less time distracted by financial concerns and more time focused on their responsibilities. Simple as that.

Lower employee turnover.

Access to financial wellness resources increases employee loyalty. In fact, in the Bank of America study, 84% of employers said offering financial wellness tools to their teams helps increase employee retention.

Stronger workplace culture.

When employees feel supported in all aspects of their lives, including personal finances, they bring more trust, morale, and motivation to the team.

Reduced absenteeism.

“Financial stress is a leading cause of absenteeism, with employees who are struggling financially more likely to miss work due to illness or personal reasons,” writes the team at Sophia, the female-focused financial education platform for the financial services sector and corporates. Programs that reduce that stress lead to fewer sick days.

Lower health insurance costs.

Money-wise employees may directly help your company save money. Financial stress is linked to chronic health issues like high blood pressure and heart disease, among other things. This can drive up healthcare claims. Thus, reducing that stress can cut overall healthcare expenses.

Financial literacy training–both a perk and a business strategy

Workplace financial literacy isn’t about turning your team into expert investors. It’s about providing them with the knowledge and tools to feel confident in managing their money and secure about their financial future.

That sense of security doesn’t just help people sleep better at night—it allows them to stay focused and productive during the workday. Besides, people tend to value companies that take care of not only their businesses, but also their employees’ well-being. As a result, they’re more likely to stay loyal to these employers, rather than switching jobs whenever offered slightly higher pay. And these kinds of employees—productive and loyal—are the most valuable to your business.

Article written by

Krista Krumina

Krista is the co-founder of Truesix Co, a content marketing and PR agency for tech companies. She’s also a freelance contributor at Business Insider and has written for outlets such as NY Observer, TNW, Sifted, Tech.eu, TimeOut, and many more. She mainly covers work life, startups, tech, and entrepreneurship.