Getting people to take beneficial action is puzzling and difficult.
It’s clear cigarettes are bad for us, yet many still smoke.
Most people understand it’s valuable to spend less than you make, yet a majority live paycheck-to-paycheck.
To help facilitate positive long-term outcomes, the 401(k) industry has developed tactics like auto-enroll and auto-escalation, which have had promising results.
Motivation is also an interesting thing.
As a self-motivated person, I’m bemused by those who aren’t. In the 20 years I’ve spent working to help others break bad habits and create good ones, I learned a lot about motivation and I want to share my findings with you. I’m hopeful it will help you successfully implement a financial wellness program in your company.
Fundamentally, there’s internal and external motivation. We’re used to external motivators like grades, parental approval, trophies, performance reviews and sales numbers. The holy grail of motivation however, is internal motivation.
My anecdotal experience has shown me that around 15 to 20% of people are self-motivated, and 15 to 20% of people will never be. As an employer, you want to hire as many self-motivated people as you can find. The real opportunity lies in 60 to 70% of people who can learn to become more self-motivated.
While the purpose of this post is to help you successfully implement a financial wellness program at your company, I know you’ll be able to take the principles I’ll share and apply them to many other aspects of your organization.
Here’s what we’ll cover:
- Self-determination theory
- Autonomy
- Competence
- Relatedness
- Closing
Let’s get started.
Self-determination theory
Have you ever had the experience of learning new information that perfectly reflects your existing thinking/philosophy? That was my experience when I first learned about self-determination theory. It perfectly encapsulated what I had been working on for years. Here’s a summary from the Foundation’s site:
Self-DeterminationTheory (SDT) represents a broad framework for the study of human motivation and personality. SDT articulates a meta-theory for framing motivational studies, a formal theory that defines intrinsic and varied extrinsic sources of motivation, and a description of the respective roles of intrinsic and types of extrinsic motivation in cognitive and social development and in individual differences. Conditions supporting the individual’s experience of autonomy, competence, and relatedness are argued to foster the most volitional and high quality forms of motivation and engagement for activities, including enhanced performance, persistence, and creativity. In addition, SDT proposes that the degree to which any of these three psychological needs is unsupported or thwarted within a social context will have a robust detrimental impact on wellness in that setting.
Don’t worry, I’m not going to quote any academic papers. From here, I’ll simply share how I’ve seen it work and give you ideas on how you can implement its core ideas in your organization.
The three core areas to focus on are Autonomy, Competence and Relatedness.
Autonomy
We have autonomy when we feel we have control over how we do our work. When we feel like we’ve got freedom to get things done as we see fit, that’s when we have a sense of autonomy.
To help people cultivate this skill, give them options. When presented with options, let them decide how they’d like to proceed. Don’t try to control or influence them, let them figure it out on their own. While they may make mistakes early on, over the long-term, the skills and abilities they’ll learn will pay dividends to you and your organization.
For your financial wellness program, you can foster autonomy by giving them different topics to learn about, as well as different mediums. For example, you can offer training on how to get out of debt, set up a budget, and how to start investing.
Competence
Competence speaks to our desire for mastery. We want to get good at things, and we want to be good at our work.
You can foster this by giving your people the “right amount” of challenge. Giving them too little will create someone who is bored, and giving too much can result in burnout. Obviously, “just right” is a difficult balance to strike, but that’s why you make the big bucks.
For your financial wellness program, we’ll stick to the previous three examples of getting out of debt, budgeting, and investing. Within each of those, provide written, video and interactive opportunities for your people to take advantage of. Allow them the ability to continue learning if they desire, and continue providing additional resources as they’re using them.
Relatedness
The famous Harvard Grant study followed a cohort of young people for over 80 years in hopes of determining what leads to a happy life. The answer is human connection and community. Relatedness speaks to our human desire for connection and how we want to be a part of something greater than ourselves.
You can foster this in your organization by showing your people you care about them. No doubt you’re already doing this, but it bears repeating because this is essential to the overall success of your org.
For your financial wellness program, you can create opportunities for immersive and interactive experiences. Within Money Alignment Academy, we have week-long activities like the Strive Online Bootcamp, where participants detox their spending, screentime, diet, and exercise programs.
Other ideas are hosting a book club, bringing in speakers, or volunteering as a company.
Closing
Remember, some of your employees will be inherently self-motivated, and some who will never be. Your opportunity is to train those folks in the middle, and to help them become self-motivated.
Your company’s financial wellness program doesn’t need to be expensive or sophisticated. The internet has all the free resources you need to put a great program together. Using the self-determination theory as the framework, you can help your people get on the path to financial success.
Resources mentioned
Learn more about Money Alignment Academy, or let us know if you’re in the market for a 401(k).
We’ve got three free courses as well: Our Goals Course, Values Course, and our Get Out of Debt course.
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