Financial wellbeing is the sense of security and control regarding one’s finances. This includes the confidence to respond to unexpected expense, meeting financial goals and having a sense of financial freedom to make choices that allow us to enjoy life, without worry and stress.
In the workplace, financial wellbeing is an aspect of overall wellbeing that perhaps hasn’t always received as much attention as areas such as physical health or mental health.
This is because, in general, many of us underestimate the impact financial conerns can have on other areas of wellbeing, in particular mental health. Indeed, many mental health issues are caused by financial stress and money worries, or exacerbated by such financial struggles.
Financial wellbeing and the workplace
Worrying about money leads to poor mental health, presenteeism, lower productivity and concentration levels, and often results in poor quality sleep. Employees with low levels of financial wellbeing are more likely to suffer from anxiety, panic attacks and depression compared to those who aren’t as worried about money issues.
Research carried out by Aegon in a recent report found that 30% of employees are facing financial difficulties. The report – entitled Financial Wellbeing and Productivity – also found that only one in seven employees are receiving financial education from their employer, while 35% feel that they would benefit from it. The report also stated: “Poor financial wellbeing costs UK employers £1.56bn each year through absenteeism and presenteeism.”
The role of employers
Employers should be more aware of the impact of financial concerns on their workforce and in turn find ways they can help in this area. A starting point can be achieved by carrying out finance-focused surveys, analysing the results and finding out the extent of staff financial concerns.
From there the following could be considered:
- Managing finance workshops
- Salary sacrifice schemes
- Retirement planning advice
- Developing a management culture which appreciates the benefits of educating the workforce on healthy money management and sharing knowledge to allow employees to make informed financial decisions
- Access to an independent financial advisor (either through a helpline or regular in-person visits)
- Employee discount schemes
- Savings schemes
- Gym discount schemes or physical activity allowances
- Providing information on pension schemes and general pension advice
- Money management advice – this can be delivered via newsletters and publications as well as during financial wellbeing workshops
There are organisations that companies can reach out to for expert financial advice. Neyber has a wellbeing hub and offer free financial wellbeing tools, calculators and expert advice. Wealth Wizards is a digital financial advisor, which can support employees to focus on a positive financial future.
If employers focus on financial health and concerns, alongside the other ‘more conventional’ aspects of wellbeing, this will lead to a more secure and positive workforce and in the long run, enhance the overall wellbeing of the company.