Increase the ROI on your employee benefits

In the current competitive job market, companies are investing significantly in employment benefits. Think of physical and mental wellness programs, learning and development budgets, discount schemes, and pensions. In the Netherlands, companies spend on average about €1,200 per employee per year on these benefits.

It's no surprise, then, that the market for secondary benefits is growing enormously. Worldwide, companies spend $55 billion per year on these perks. This is expected to increase further to $78 billion by 2032, a rise of 42%!

Low adoption among employees

However, despite these large investments, employees often do not make optimal use of these benefits. HR teams spend up to 20% of their time organizing and communicating these perks, but many companies see low adoption rates among employees. Activation rates average from just 5% to 25%. Additionally, many personal budgets are rarely fully utilized.

Challenges for HR departments

This low usage leads to inefficiencies and a low ROI on these benefits, posing challenges for HR departments. Various apps, platforms, and communication channels cause confusion and fragmentation. HR departments struggle to provide a unified overview of all secondary benefits, leading to missed opportunities and difficult conversations with CFOs and broader management about the effectiveness of these investments. Confidence in the ROI decreases, which can lead to a reduced budget for benefits.

Benefits are financial advantages

Essentially, benefits are financial advantages for employees, intended to stimulate their personal and professional development. These perks have a direct impact on the employee's financial situation. Therefore, it's important for employees to view these benefits within the context of their own financial picture and the opportunities they present. In this way employees will see the missed chances of not fully using their benefits.

The role of financial planning

This is where Equip comes into play. Equip offers employees financial planning conversations with independent experts. At Equip, we see that no less than 40% of an organization's employees engage in at least one financial planning session. During these consultations, Equip's financial planners also discuss the company's available benefits and the opportunities they offer to the employee. Our planners are fully prepared for this because employers share the available benefits with Equip prior to the collaboration.

Increased awareness of benefits

By offering financial planning sessions, employees become more aware of their financial situation and the available secondary benefits. This holistic insight helps employees make optimal use of all the excellent perks their employer provides.

Impact on employees and organization

This increased awareness leads to:

• Higher utilization of benefits: Better participation in pension schemes, increased use of learning and development budgets, and more conscious choices within perks.

• Increased ROI on benefits: Employees derive more value from their total compensation, and the organization sees a better return on its investments. The business case communicated to management now becomes much more attainable.

• Improved employee well-being: Employees feel more confident because their greatest source of uncertainty—finances—is addressed. This reduces stress and increases productivity and retention.

• Greater efficiency for HR departments: Less time spent on communicating and managing benefits, as Equip functions as an extension of the HR team.

Initial research results show that Equip increases the utilization of existing benefits by up to 20% on average—a significant improvement.

Conclusion

By integrating financial planning as a strategic extension of HR, organizations can support their employees' financial well-being while also maximizing returns on their investments in other benefits. Equip facilitates this process by providing employees with the knowledge and resources to improve their financial well-being, which includes making use of the offered benefits.

Would you like to know more about how Equip can strengthen your HR strategy and serve as a strategic extension of your HR team? Please contact us.