Financial Wellness Benefits That Actually Improve Retention

November 6, 2025

Stephanie Gilman

Attracting and retaining top talent isn’t just about compensation anymore. In today’s competitive labour market, financial benefits for employee retention are becoming a cornerstone of modern HR strategies. Especially for younger generations like Gen Z and Millennials—who report high levels of financial stress—programs that address real-world money challenges can make or break an employment decision.

Financial stress affects productivity, morale and job satisfaction. And when left unaddressed, it drives turnover. But when employers invest in targeted financial benefits, they gain employees who are more committed, focused and engaged for the long term.

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Measuring the retention ROI from financial wellness programs

Employee turnover is expensive. The Society for Human Resource Management (SHRM) estimates that replacing a salaried employee costs six to nine months of that employee’s salary—with senior-level exits costing even more. In today’s competitive job market, younger workers are especially willing to walk: Betterment found that 84 per cent of Gen Z employees and 79 per cent of Millennials would consider leaving their current role for one that offered stronger financial benefits.

In this context, retention through financial wellness isn’t just a nice-to-have—it’s a proven business strategy. Employees under financial stress are more likely to feel distracted at work, experience mental health challenges and take more health-related absences. On the flip side, companies that invest in financial well-being can see substantial improvements in engagement, loyalty and overall productivity.

The effect of financial anxiety on turnover rates

Financial stress doesn’t just weigh on employees—it shows up in retention numbers. PwC’s 2023 Employee Financial Wellness Survey found that employees who report financial stress are twice as likely to look for a new job compared to those without money worries. The same survey revealed that financially stressed employees are also more likely to be distracted and less engaged with their work.

Deloitte’s 2025 Gen Z & Millennial Survey reinforces this: employees who reported feeling financially secure were significantly more likely to recommend their employer as a great place to work to a friend.

For HR leaders, the takeaway is clear: reducing financial stress through targeted benefits isn’t just about helping employees feel better—it directly reduces turnover by lowering the desire to look elsewhere.

” Programs like these—especially those with payroll-deducted savings or employer-matched contributions—help employees build financial security while reinforcing trust in their employer. ”

What financial wellness benefits reduce turnover?

To retain employees, it pays to offer the benefits they actually want. According to Betterment’s survey, the most attractive financial wellness offerings—those most likely to reduce turnover—are:

Access to a high-quality retirement savings plans;
Employer matching contributions;
Wellness stipends;
Flexible spending accounts (FSAs) or health savings accounts (HSAs); and
Employer-sponsored emergency fund.

These programs speak directly to employees’ long-term financial security and their short-term stability—two key drivers in the decision to stay or go.

When financial benefits are easy to understand, clearly communicated and seamlessly accessible, employees feel empowered and supported—and that makes them far more likely to stay.

Building workplace retention strategies around financial wellness

A successful retention benefits HR strategy doesn’t just tack on a few perks—it embeds them into the employee experience. This starts with understanding employee needs and designing programs that are a few things.

Relevant: Tailored to life stages, from first jobs to family planning.
Clear: No jargon, just straightforward explanations and transparency.
Flexible: Multiple ways to access or apply benefits.
Proactive: Delivered year-round, not just during enrollment.

Consider offering opt-in budgeting tools, Slack-based Q&As with financial experts, or short videos explaining the impact of emergency savings. HR teams that make financial benefits feel human—not corporate—will build lasting loyalty.

Also key? Training managers to talk about these benefits without stigma. When financial wellness tools are normalized rather than hidden in back‐end portals, employees are more likely to use them and feel supported.

How retention improves with emergency savings benefits

Emergency savings programs are one of the most effective—and often overlooked—financial benefits for employee retention. Why? Because nearly half of Gen Z and Millennial workers say they don’t have enough saved to cover three months of expenses, leaving them financially vulnerable and anxious.

Delta Airlines recognized this need and launched an emergency savings program in January 2023, matching employee contributions up to $250. More than 21,500 employees enrolled and participants reported increased financial confidence and a greater sense of control over their money.

Programs like these—especially those with payroll-deducted savings or employer-matched contributions—help employees build financial security while reinforcing trust in their employer. And when people aren’t constantly worrying about car repairs, dental bills, or surprise vet visits, they’re more focused, less stressed and more likely to stay loyal to the company that supports them.

Retention through financial wellness: the bigger picture

The takeaway is clear: financial wellness programs do much more than pad a benefits package—they directly reduce turnover by addressing one of the most common sources of employee stress. Employers who make financial well-being part of their workplace retention strategies not only help workers feel more secure, but also strengthen their own ability to compete for and retain talent in a tight labour market.

In other words, retention programs with financial wellness at their core benefit both sides: employees gain confidence and stability, while employers build a stronger, more committed workforce.

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