Did you know that 4 out of 10 employees say they feel worried about their financial situation? Numerous studies have shown that many employees inquire about financial advisory services from their employer. As many as 86% of the participants in a comprehensive study made by Fidelity Investments said they would participate in programs and education on how to reach financial wellness if their employer offered it.
Perhaps you as an employer think employees themselves bear the full responsibility for their finances. However, with many employees saying they feel stressed about their finances, especially in light of the current high cost of living, it may be time to rethink whose responsibility it actually is. Research conducted by the British multinational investment bank and financial services company Barclays shows that being stressed over one’s financial situation can stutter growth and productivity.
Would it surprise you to learn that 56% of employees say they are very or somewhat stressed about their financial situation?The top three stress factors are:
- Saving for the future – 67%
- Paying monthly bills – 57%
- Credit card debt – 42%
Additional research shows that financial counseling services and tools aimed at budgeting, saving, and investing is something employees want – with 86% of those surveyed saying they would participate in a financial education program provided by their employer. Without these tools in place, employees can easily fall by the wayside when it comes to their mental health. It has been claimed that a lack of wealth and/or money concerns leads to poor health and this then leads to them stressing over financial matters at work. This is called The Snowball Effect and you can read more about this in the financial wellbeing e-book (link at the end of this blog).
By offering financial advice or benefits within financial wellness, it demonstrates that you as an employee care about the livelihood of your employees, as well as tackling high inflation head on.
Financial wellness as an employer brand
Financial wellness is quickly becoming the number one benefit across the globe. The term ‘financial wellness’ is also garnering more attention within HR circles as an actionable strategy which can:
- Engage employees
- Motivate employee
- Earn employee loyalty
- Boost employee productivity
- Help retain employees for a longer period
Today, employers have an important role when it comes to their employees’ financial wellness. Financial concern is not something employees can simply shrug-off and ignore during their workday. The effects of financial concern can take a toll on attendance, engagement and performance. Luckily, there are many ways an employer can bring peace of mind to employees when it comes to this area.
4 simple ways to help your employees’ financial situation:
- Help with student loans
- Be progressive with paid parental leave
- Cultivate financial education partnerships
- Offer financial counseling
According to Bank of America’s annual 2019 Workplace Benefits Report, 53% of U.S. companies offer financial wellness programs today compared to just 24% in 2015. These programs can include any of the following providing resource materials or referrals, online assessment, advice tools, group instruction and one-on-one advice with a financial counsellor.
In comparison, according to CIPD, only 11% of companies with health and wellbeing strategies also focus on financial wellbeing, with 57% focusing on mental wellbeing. CIPD also claim that 47% of UK employees are affected by money worries.
As we move towards 2023, employers should be actively putting financial wellbeing measures in place for their employees, otherwise they will be overwhelmed by the pressure of the rise in the cost of living and the after effects of the pandemic (which is still a concern at the time of this blog being published).
If you want to know more about financial wellbeing and how to go about implementing it, then check out our guide to Financial Wellness eBook below.