OWNING a business comes with a unique opportunity: the chance to better the lives of your employees. The paycheck you provide helps them pay for their daily expenses and supports the local economy. But there’s an opportunity to do even more: By being thoughtful in how you structure employee benefits, you can ensure they have a more prosperous future, while also helping them lead happier lives today.
Remember, money is simply a tool to help you enjoy your life—and one way to do that is to buy time. You might pay someone to do chores you hate, so you have more time for the things you love. An example: You could hire a lawn-mowing service, so you can spend an hour at the park with your spouse and kids.
The problem is, simply knowing this will make you happier isn’t enough. We humans have a difficult time trading money for time. We may feel that outsourcing certain tasks will make others think we’re lazy. Being busy helps us feel more important—and it’s a characteristic we associate with success. On top of that, we believe that we’ll have more time in the future. In short, we sacrifice time now, in hopes of slowing down later.
Where do you—the business owner—come into this story? Here are three ways you can help your employees lead happier lives:
1. Push them to save for retirement. First and foremost, you should have a retirement plan available to your employees. Once that’s in place, automatically enroll employees and automatically escalate the amount they contribute each year.
By auto-enrolling your employees, you’ll increase participation rates. Meanwhile, auto-escalation will increase their contributions by perhaps 1% per year, without any additional effort on their part—and probably without them even noticing. Your employees can always opt out. But research suggests they’re likely to stick with it.
2. Give the reward of time. Employers with performance-recognition programs often offer a menu of rewards. These can range from time-saving services like housekeeping to money-saving items like Amazon gift cards.
Even when offered time-saving services, research shows that employees opt for money. You can help employees by changing the game. Separate the rewards program, so that certain rewards can only be redeemed for time-saving services and other rewards can only be redeemed for money-saving items. This will compel your employees to redeem time-saving rewards—and help them feel less guilty in the process.
3. Market time as money. Since most people have a money-first mindset, help employees make the most of their benefits package, by associating a dollar amount with each component. When employees understand the financial value of their vacation time and their health insurance, they’re more likely to take advantage. One upside for the company: Time away from the job allows employees to recharge their batteries—and they’ll be more productive when they return.
Ross Menke is a certified financial planner and the founder of Lyndale Financial, a fee-only financial planning firm in Nashville, Tennessee. He strives to provide clear and concise advice, so his clients can achieve their life goals. Ross’s previous articles include Par for the Course, Not Toast and Cash Is King. Follow Ross on Twitter @RossVMenke.
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