Resources
A Short History of Workplace Financial Education
By the Financial Knowledge Content Team ·
Financial wellness is now a familiar employee benefit, but the idea behind it is much older than the term. It grew out of decades of work by independent educators, employers and researchers who saw that employees needed help understanding their money. Here is a dated timeline, with sources, of how workplace financial education took shape.
Timeline
1978–1981
Retirement decisions shift to employees
The Revenue Act of 1978 added Section 401(k) to the tax code, and IRS rules in 1981 opened the door to salary-deferral retirement plans. As 401(k) plans spread through the 1980s, employees, not employers, became responsible for many of the biggest decisions about their retirement savings. Employers needed a way to help them understand those choices.
1989
Financial Literacy Action Center is founded
Financial Knowledge began in 1989 as Financial Literacy Action Center. Its founder, a former broker who also earned the CFP® certification, built it on one principle: financial education should be education, not a path to selling financial products. Classes for community groups soon led to requests from employers who wanted the same education for their employees.
1991
“Workplace Education in Financial Lifeskills”
A federal trademark application filed August 28, 1991 identified the organization as Financial Literacy Action Center, “Workplace Education in Financial Lifeskills,” offering educational services in the field of finance, including workshops to help people understand financial and economic matters.[1]
1996
Research links workplace education to saving
A National Bureau of Economic Research study of employers found that participation in and contributions to voluntary retirement savings plans were significantly higher where employers offered retirement seminars, especially among non-highly compensated employees.[2]
1997
Financial Knowledge Network
A federal trademark application filed January 15, 1997 for the name Financial Knowledge Network described its services as “on-site employee education on finance and financial planning.”[3]
1998
“Personal financial wellness” enters the research
A Virginia Tech doctoral dissertation titled “Personal Financial Wellness and Worker Job Productivity” studied the connection between employees’ financial wellness, workplace financial education and productivity. The language and the idea of employee financial wellness were already part of academic research.[4]
1999
Research connects the two
A peer-reviewed article in the Journal of Financial Counseling and Planning, titled “Workplace Financial Education Improves Personal Financial Wellness,” reported on the link between education offered at work and employees’ financial well-being.[5]
2000s–2010s
Financial wellness becomes a benefits category
Over the following decades, many providers entered the field, and “financial wellness” became a common name for employer-sponsored financial education, coaching and tools.
Today
The same question still matters
Employers now choose from many kinds of providers, and the question that shaped the field’s earliest days still matters most: is the education independent, or is it connected to selling something?
What the record shows
Financial wellness developed over time, from financial literacy work, employee education, financial counseling and workplace benefits, and its core ideas were being practiced and studied years before the term became common in the benefits industry.
Financial Knowledge is proud to be part of that history. Since 1989, first as Financial Literacy Action Center and later as Financial Knowledge Network, we have provided independent workplace financial education. We have never sold financial products or earned commissions, and our courses are led by CERTIFIED FINANCIAL PLANNER® professionals.
Independent since 1989
More than three decades later, our mission has not changed: conflict-free, accredited financial education for employees, with no products to sell, no commissions to earn and no financial institution influencing what we teach.
Read our storyFrequently asked questions
Where did financial wellness come from?
Financial wellness grew out of decades of work in financial literacy, employee financial education, financial counseling and workplace benefits. Employers were offering financial education seminars by the mid-1990s, and researchers were studying “personal financial wellness” and workplace financial education by 1998.
When did workplace financial education begin?
Workplace financial education grew in the 1980s and 1990s as 401(k) plans shifted retirement decisions to employees. Financial Knowledge, founded in 1989 as Financial Literacy Action Center, has provided independent workplace financial education ever since, with federal trademark filings from 1991 and 1997 describing its workplace and on-site employee education.
What was Financial Literacy Action Center?
Financial Literacy Action Center was the original name of Financial Knowledge, founded in 1989. A 1991 federal trademark filing described it as “Workplace Education in Financial Lifeskills.” The organization later became Financial Knowledge Network.
What is the difference between financial education and financial wellness?
Financial education teaches people how money decisions work, such as budgeting, retirement plans, taxes and investing. Financial wellness is a broader term for a person’s overall financial health and the programs employers offer to support it. Education is at the core of most financial wellness programs.
Why does independence matter in workplace financial education?
When a provider earns money from products, commissions or referrals, education can turn into marketing. Independent, conflict-free providers are paid only by the employer, so their only goal is helping employees understand their choices.
Sources
- U.S. Patent and Trademark Office record, Serial No. 74198983 (filed August 28, 1991)
- Bayer, Bernheim and Scholz, “The Effects of Financial Education in the Workplace: Evidence from a Survey of Employers,” NBER Working Paper 5655 (1996)
- U.S. Patent and Trademark Office record, Serial No. 75226114 (filed January 15, 1997)
- Joo, “Personal Financial Wellness and Worker Job Productivity,” doctoral dissertation, Virginia Tech (April 15, 1998)
- Garman, Kim, Kratzer, Brunson and Joo, “Workplace Financial Education Improves Personal Financial Wellness,” Journal of Financial Counseling and Planning 10(1) (1999)
