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Based on the life-cycle theory of consumption, this quasi-experimental study of 995 employees examined changes in financial behaviors following employee-needs-driven workplace financial education. Repeated-measures ANOVA compared participants and non-participants on perceived financial wellness and savings ratios; main effects indicated that both groups improved pretest-to-posttest on both variables (p<.001). A Wilcoxon signed-rank test determined that frequency of negative financial behaviors declined for participants (p<.001). Logistic regression determined likelihood of performing specific financial activities following financial education programming. Participants were 1.8 times more likely than non-participants to budget, 1.9 times more likely to undergo asset allocation assessment, and 1.6 times more likely to increase retirement contributions (p<.001). Results lend support to workplace provision of both basic financial education and retirement planning programming.
Key Words: workplace financial education, financial wellness, financial behaviors, life-cycle theory, retirement savings
Introduction
Throughout their lives, Americans experience levels of living based on their incomes and the consumption and savings decisions they have made over time. The goal, according to the life-cycle theory of consumption, is to balance the consumption and saving functions during the working years such that the desired level of living remains stable throughout the lifespan, including during retirement (Modigliani & Brumberg, 1954). There seems to be a disconnect between the theory and reality, however, with respect to consumers' ability to achieve this balance. A recent study of stress in Americans, for example, revealed that money worries are the primary cause of stress (American Psychological Association, 2014). For some, the problem may not be inadequate income, but rather a lack of both financial management knowledge and the skills needed for appropriate allocation of resources available for consumption and saving. Since Americans spend approximately 56% of their waking hours at work (Bureau of Labor Statistics, 2009; 2010) in pursuit of resource acquisition to support their households, the workplace is a logical place to offer financial education to help employees become more effective in the allocation of such resources.
There has been increased employer interest in recent years in the promotion of financial well-being and financial literacy of employees through the provision of workplace financial education. Many employers provide financial education about retirement planning and investing, but far fewer offer education about personal financial management strategies. Such programs, targeting basic financial concepts...