Authority ( FINRA ), 63 percent of Americans are financially illiterate . Sadly , it ’ s safe to assume that about half of your team members do not understand money .
Financial literacy matters . Those with higher financial literacy are 51 percent more likely to spend less than what they make and are 55 percent more likely to set aside money
in an emergency fund . Those with higher financial literacy are also more likely to take actions like calculating retirement savings needs and opening a retirement account .
Financial literacy is only one part of the equation . And doesn ’ t necessarily lead to outcomes that lead to greater financial wellness . But it is the first place to start .
Here are 5 steps spa leaders can take to help their teams become more financially literate and increase their team ’ s financial wellness .
1 . Help your staff connect to their “ MONEY WHY .”
Each team member might have a different “ money why .” For younger staff , it might be financial independence . Some might be purchasing their first home . For others , it might be travel and experiences . Tapping into this ‘ money why ’ can help leaders break down barriers and drive performance in the workplace .
A perfect example of this was Diane . Diane , an employee , was struggling , missing goals , and not performing at the level Michele , her employer , needed . Michele saw so many ways for Diane to increase her income , but she just couldn ’ t get Diane to care about how much money she was making , let alone identify opportunities to increase performance .
After some financial wellness education , Diane opened up and shared with Michele that her dream was to travel to Japan . Their coaching sessions transformed from frustrating and stagnant to exciting and creative . Connecting to her “ money why ” helped Michele better understand Diane , and it helped Diane understand that changing her performance could help her achieve this money goal . Diane ’ s performance improved and she ’ s on her way to saving $ 4,000 to take her dream vacation .
2 . Help team members truly understand their paycheck .
In working with market leading salons and spas for over a decade , we ’ ve found that the vast majority of professionals ( and , in many cases , leaders ) do not understand their paychecks .
With so many people utilizing direct deposit , very few people take the time to even look at their pay stub . For the few that do , it typically creates more confusion than clarity . This confusion creates unnecessary conflict and can lead to mistrust between leadership and service providers — for example , employees thinking that their employer is stealing money ( hello , taxes !)
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30 PULSE n OCTOBER 2022