Should you care about your employees’ financial wellbeing?
The short answer is yes.
Why? In summary we think this is an important subset of overall mental health and wellbeing and one directly linked to productivity and engagement.
Firstly, what do we mean by ‘financial wellbeing’? It is certainly not a case of employers crossing the red line into employee’s personal finances or making value judgments about how employees manage their money. It is much about recognising the link between an employee’s state of mind and their productivity.
Put simply, if their finances are out of control they won’t be concentrating on work, they will be worrying about money.
We have all done it at work, the surreptitious check of the online bank account when your boss isn’t around, a look at a price comparison site or a call with your bank or mortgage broker about a stressful issue. Why is that we feel it must be done in the shadows, why is financial wellbeing a workplace taboo?
A lot has to do with the British psyche, a bit to do with trust in our employers and much to do with data security and protection. However, there is an increasing recognition that employers can play a part in helping employees manage their finances.
The Financial Conduct Authority, the UK financial services regulator, conducted a Financial Lives Survey in 2017 which reported that 25.6 million people (half of UK consumers) showed one or more characteristics of potential financial vulnerability.
Faced with difficult economic conditions people are concerned about how they spend, save, invest and manage risks to protect their standard of living, especially for the long term. Yet when faced with an unexpected £300 bill, 11.8m adults (23%) would have to borrow or could not pay. I am sure you will agree that these are shocking figures.
The reality is that this is happening in your business, in all businesses, your employees are just not talking to you about it.
What can employers do about it?
There are lots of common-sense things that employers can do, but here are five very simple ones to look at:
- Communicate your workplace pension scheme – you already support one of the most important tools in the battle against poor financial outcomes, it’s called a pension. Engage with it, celebrate it and communicate it – you must pay into it by law, so why not get some benefit from that?
- Employee engagement with pensions – you could go a step further and hold staff presentations, workshops or 1:1 meetings to really help employees get to grips with their long-term savings goals.
- Financial education – you could look to use digital, paper based or face to face programmes to help drive up general financial knowledge within your workforce. This could cover, debt, savings, mortgages, pensions or just managing the gas and electricity bill better.
- Workplace Savings and Debt products – financial wellbeing is a huge growth area in employee benefits, with new products coming online all the time from mainstream financial institutions like banks and pension companies, but also from challenger brands like Neyber and Salary Finance. These new options use technologies to increase engagement, build trust and appeal to tech savvy workers.
- Think creatively – do you as an employer really care if your non-salary spend (above AE minimums) goes to a pension or is used to pay off student debt or help employees save for house deposit? It’s time to think creatively about how reward is structured, to give greater weight to overall financial wellbeing, not exclusively long-term saving.
All these measures should start to tackle the wider problem of poor financial wellbeing, at the same time as improving employee engagement with your company and boosting worker productivity.
If you would like to learn more about how to tackle employee financial wellbeing then speak to The Ink Group on firstname.lastname@example.org, or call us at 01858 810200. Alternatively, please contact your usual Account Director or Account Manager
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