Enhance the Effectiveness of Your EAP and 401(k) Offerings with Real Financial Wellness

What is financial wellness? The idea sounds simple, but—like an iceberg—there’s a lot more happening beneath the surface.

The truth is, the definition keeps changing depending on who you ask. For some, financial wellness means a sky-high credit score and a collection of fancy stuff. Can’t swing that? No problem—you can always leverage “good” debt to boost that score. And while you’re at it, why not grab that car loan you hope you can make work?

If that doesn’t feel like real financial wellness, that’s because it isn’t. But you won’t hear that from many people—especially some of the “experts” who actively encourage debt simply because it’s considered normal.

Spoiler: Normal is broke. True financial wellness is weird. And it’s definitely not subjective. Real financial wellness means helping your team take control of their money—so they can handle emergencies without financial panic, spend with confidence, eliminate debt, and build a clear path toward long-term goals like retirement.

Let’s break down further what real financial wellness actually is and why the benefits you currently offer may not be enough to spark meaningful money transformation.

The State of Personal Finance in America Today

First, let’s get real about where we are now. Here’s what the State of Personal Finance in America study shows us:

• Nearly half (49%) of Americans live paycheck to paycheck.
• 50% worry about their finances every single day.
• 43% of Americans have difficulty paying their bills.
• Over a third (37%) of Americans lose sleep over money.
• A third (32%) are either struggling or in crisis with money.
• 54% have made a money mistake they regret to this day.

Even with these numbers, Americans’ priorities rarely line up with what actually improves their finances:

• 45% would prefer a high credit score over a paid-off car.
• 42% admire people who own expensive homes, cars and clothes.

And this isn’t about income levels—it’s about behavior. A survey from The Harris Poll found that nearly 1 in 3 six-figure earners feel stretched or drowning, and 44% are one unexpected bill away from financial chaos..¹ Yup. Even our top 10% earners are struggling and leaning on debt.

Look, if bad money habits aren’t addressed, stress and income insecurity will chip away at your company’s productivity, culture and retention.

What Is Real Financial Wellness?

Okay. We can’t sit here and put the word “real” next to financial wellness and not tell you exactly what we mean. Real financial wellness means:

Having Control Over Day-to-Day Finances

So much of today’s money stress comes down to control. Most people know how much money is coming in each month, but they have no real idea of what’s slipping out. And without clarity, they can’t create the margin they need to breath, save and get ahead.

That’s why the first time someone opens EveryDollar (the budgeting app from Ramsey Solutions) they free up an average of $3,015.* It gives them a head start on telling their money where to go—instead of wondering where it went. Again, this an income issue. It’s a control problem—both behaviorally and organizationally.

Having Cash Set Aside for Emergencies

Employees can’t shake money stress if they’re always one surprise away from a financial crisis. And it doesn’t take much to knock them off balance—a blown tire, an unexpected medical bill, or that late-night emergency vet visit after Fido swallows a sock. When emergencies get paid for with debt, it pours gasoline on the fire.

But the opposite is just as true. When people have even a starter emergency fund—that’s just $1,000 set aside—they can breathe easier knowing those surprise expenses won’t derail their goals. That peace of mind is priceless. And according to the SmartDollar Impact Study, a higher percentage of SmartDollar users—the financial wellness program from Ramsey Solutions—could cover a $1,000 emergency with cash compared to nonusers (74% vs. 62%). That’s huge.

Managing Expenses and Spending With Confidence

Almost every meaningful pursuit starts with the same truth: Confidence is key. When employees learn how to save consistently, pay off debt, and spend with intention, their confidence around money skyrockets.

They’re no longer guessing whether they can cover the bills. They’re not refreshing their checking account every few minutes (or avoiding it entirely out of stress). And best of all? They can spend guilt-free—because they’ve already put in the work of giving every dollar a job.

A strong financial wellness program hands them the keys to their money. SmartDollar users, for example, report nearly double the confidence in personal finances from when they started.

And that confidence? Just like stress, it doesn’t stay at home. It walks into work with them, sits down beside them, and fuels stronger focus, better performance and a whole heck of a lot more mental peace.

Eliminating Debt—Not Managing It

There’s no such thing as managing debt. For real financial wellness to happen, debt has to go. The thing is, too many financial wellness programs still promote the idea of “good” debt. But the truth is simple: Debt is debt.

And Americans are carrying more debt than ever—$18.59 trillion in household debt, which includes mortgages, student loans, car loans and credit cards. Student loan burdens are at historic highs (with rising delinquencies), and outstanding credit card debt alone now sits at a hefty $1.2 trillion.² Something isn’t right here.

Employers are noticing too. According to EBRI, 79% of benefits leaders now view debt management as a core part of their wellness strategies.³ Why? Because even so-called good debt drags people down—shaping how they show up at work, how long they stay, and whether they feel free to grow. (And let’s be honest: If it were truly good, debt wouldn’t need so much babysitting just to keep it from tanking your life.)

When we normalize managing debt instead of eliminating it, we normalize unnecessary bills and a workplace culture where people feel trapped in their jobs, not thriving. And at the end of the day, debt-free people tend to share qualities like self-control, goal setting and confidence—qualities that make someone a valuable employee. They can show up fully, contribute reliably, and even lead without being held back.

Staying on Track for Long-Term Savings and Retirement Goals

According to the State of Personal Finance study, over half of millennials (53%) now carry more debt than retirement savings. And two-thirds of all Americans expect to work past age 65, with a full third saying they’ll do it because they have to. In other words, many people simply don’t have enough saved to support themselves in retirement. That’s not just a national money issue—it’s a slow-burn crisis.

The best financial wellness benefits don’t just teach people how to “be better with money.” They help employees take control of their day-to-day finances so they can make real progress toward long-term goals like trying to buy a home, paying cash for a car, or building a strong retirement fund. And that progress matters. When people feel confident about their money and what it’s helping them build, they feel more control over their future too.

But here’s the reality. There’s a cycle at play here—one that true financial wellness is designed to break. As we’ve covered, stress is one of the top issues employees face today (remember—half of America worries about money every day). And when people feel stuck financially, that stress shows up everywhere—at work and at home. That leaves scarily little room for long-term thinking. When mental health drags down finances, finances drag down mental health—and people get stuck in a loop.

On the flipside, when employees have a clear plan with their money, everything starts to change. When that cycle breaks, lives transform. And long-term thinking comes back into the picture. At one enterprise company, SmartDollar participants increased their retirement contributions by 70% more than those who didn’t enroll. That’s the power of momentum and transformed futures.

What About Our Current Benefits—Like EAPs and 401(k)s?

Let’s start with the good stuff. Employee benefits today are pretty comprehensive. A ton of companies offer Employee Assistance Programs (EAPs) and employer-sponsored retirement plans like a 401(k).

EAPs provide crisis-level support for personal issues, mental health, substance abuse and basic financial help when an employee is in real trouble. And retirement plans give employees the chance to build wealth, invest for the future, and retire with confidence.

But here’s the truth: Neither of these benefits are enough to spark real transformation without a strong financial wellness program connecting them.

EAPs: Crucial, but Not Designed for Long-Term Change

EAPs are like a workplace first-aid kit—crucial when something goes wrong but not built to keep employees financially healthy long-term. Most offer a mix of generic financial tips, short-term consultations and some educational content. Helpful in the moment? Sure. But none of that creates real behavior change or gives employees a proven, step-by-step plan to get out of money stress for good.

EAPs are also reactive by design. They only step in after a crisis hits. That means employees end up stuck in the same stressful money patterns again and again. If this is all your business offers for financial well-being, it often ends up feeling more like checking a box than real support.

That’s where a strong financial wellness program can take the baton and run with it. Programs like SmartDollar provide an actionable plan, ongoing engagement and the kind of long-term behavioral change EAPs were never designed to deliver. When paired with an EAP, financial wellness benefits fill the gap—giving employees both immediate support in a crisis and a proactive path to control of their money. And once that foundation is in place? It naturally leads to the next part of the benefits picture: retirement plans.

401(k) Benefits: Powerful Tools Collecting Dust

Retirement benefits are also deeply important (which is obvious, right?). They help employees build real wealth with confidence so they can retire on their terms. But if someone is living paycheck to paycheck, juggling rising bills, and carrying heavy debt, they simply don’t have the margin to contribute consistently—let alone maximize an employer match. The result? A fantastic benefit ends up collecting dust instead of transforming lives.

And with hardship withdrawals jumping from 1.7% in 2020 to 4.8% in 2024, it’s obvious that money stress isn’t just affecting employees in the moment.⁴ It’s eating away their savings before they have a chance to grow. So if fewer people than you’d like are actually taking advantage of your retirement benefits, the benefit itself probably isn’t the issue. It’s a cash-flow and margin (the money left after expenses) problem.

Financial Wellness Is the Missing Middle

Let’s be clear—both benefits matter. EAPs are essential when someone hits a personal crisis, and retirement plans are the smartest path to long-term wealth (for people who have the margin to invest). But what about everyone in between?

 These are employees who:

• Aren’t in crisis—but aren’t thriving either
• Don’t qualify for hardship support
• Want to invest but feel like they just can’t yet
• Feel stuck, overlooked or unsure where to start

And then there’s the everyday Joe or Jane who’s doing okay—bills are paid, the paycheck shows up—but they know they could be doing more. Without a clear, proven plan to change their day-to-day habits, they could just stay stuck in the middle. Not in crisis. But no confidence either. Just okay. Just . . . coasting their working years away.

And this in-between group? Take another look at the State of Personal Finance statistics from earlier. It’s not a small group of people. It’s the norm.

That’s the gap financial wellness fills. It gives everyone—not just those in crisis or those on track for retirement—a path forward. Because financial wellness should be for every employee at every stage of their journey.

True Financial Wellness Doesn’t Compete—It Connects the Dots

The right financial wellness program doesn’t replace EAPs or 401(k)s—it supports them. It gives employees the everyday money habits, structure and confidence they need to use their benefits the way they were intended.

We’ve already covered how SmartDollar users increase their retirement contributions. But did you also know that 65% of users would recommend their employer’s benefits package as the best available, according to the SmartDollar Impact Study?

That’s what happens when people feel empowered instead of overwhelmed. When employees gain control over their day-to-day finances, crisis support like EAPs can stay focused on other serious personal issues, and participation in long-term benefits rises. True financial wellness brings balance to your benefits and peace of mind to your people.

How a True Financial Wellness Program Fills the Gaps

Your people need a financial wellness solution that:

• Gives them a proven plan to eliminate debt and build real financial security
• Delivers engaging, easy-to-follow content designed to keep them moving forward
• Helps them prevent money crises instead of scrambling to recover from them
• Drives measurable results that lift both their well-being and your bottom line

If these qualities aren’t present, then it’s not a real financial wellness program. SmartDollar achieves this by equipping employees with:

• A clear, structured plan so their next best move is never a mystery
• A hawklike focus on eliminating debt—not managing it
• Coaching that guides them every step of the way and maintains accountability
• Behavior-driven support rooted in creating real habits that actually stick
• Easy-to-use tools—like the EveryDollar budgeting app—that remove barriers, make freeing up cash easy, and keep your people on track with their goals

And here’s the best part: Financial wellness done right produces measurable results. And with SmartDollar, companies don’t have to wait long to see them.

Employees who use SmartDollar aren’t just learning about money—they’re changing their behavior. Forty-three percent say the time they spend dealing with money issues at work has gone down. That’s more attention on their jobs instead of their money worries.

And those behavior shifts lead to real financial wins. On average, SmartDollar users report $16,200 in combined debt paid and dollars saved in their first year. Also, like we mentioned earlier, a majority can now cover a $1,000 emergency in cash. And when employees feel this kind of hands-on support in their financial lives, loyalty follows. The SmartDollar Impact Study found that:

• 73% of SmartDollar users feel their employer cares about their financial well-being
• 81% would recommend their employer to a job-seeking friend

Employers can feel the shift too. Of companies that offer financial wellness programs:

• 89% report improved productivity
• 87% report fewer medical or health care claims
• 91% report stronger recruitment and retention⁵

SmartDollar clients have seen this play out firsthand. Companies see 27% less turnover on average among employees who use SmartDollar, and 66% report a positive ROI since introducing the program. Those are real, measured wins!

*Based on the average user. Your results may vary.