- Financial wellbeing
- 6 minute read
Employee wellbeing is more than just physical -- money worries can seriously and negatively affect employee engagement and productivity. Here’s how you can proactively improve financial wellbeing for your employees.
Forward-thinking organisations are waking up to the reality that, when it comes to employee engagement and wellbeing, more needs to be done. It isn’t enough to do the bare minimum. Our employees are expecting more and more of their workplaces. They look to us to help them with their physical health, their mental health and their financial health. According to Deloitte's 2018 Global Human Capital Trends report, organisations need to be social enterprises, rather than entirely business-oriented.
One concern that is never far from most employees’ minds is that of money. Financial concerns are distracting your employees and keeping them up at night. In fact, for 94% of employees, money worries are pretty all-consuming and one of the leading causes of stress. This statistic should be enough to get employers to sit up and take notice. The reality is improved financial wellbeing will help employees perform better. It will allow them to relax, focus and engage with their work. All of which will benefit your organisation in the long-run.
Below we explore 7 practical (and effective) ways to improve financial wellbeing for employees.
1. Remove barriers to communication and financial discussions
If you want to support employees through their financial worries, you need to begin with an open, honest and accepting atmosphere. Employees need to know that you care, and take their financial concerns seriously. If you haven’t yet prioritised financial wellbeing and financial education at your organisation, opening up communication might require an organisational change and an adjustment to your company culture.
Let employees know that you have a financial wellbeing strategy in place, or that you’re introducing measures to help them. Addressing the issue head-on is an important first step. It's been shown that 45% of employers worry about approaching employees over their financial wellbeing, as they think it will be perceived as an intrusion. However, 57% of employees believe organisations should do more to financially support their staff.
Maintain healthy levels of transparency and communication at all times. Consider implementing an open-door policy to discuss financial stress. Utilise team communication tools to allow for real-time communication. Do all you feasibly can to remove any and all barriers to communication. This will encourage employees to open up and ask questions about financial wellbeing.
Learn more about how to encourage employees to talk about financial wellbeing at work.
2. Offer money management advice and counselling
Companies of all sizes should consider offering some form of money management guidance and advice, including information on a wide range of topics such as budgeting, debt consolidation, and debt counselling. While some companies may have the right people and skills to offer this guidance in-house, others choose to outsource and hire professional financial education services. Such services offer tailored financial education in the workplace, providing your employees with ongoing support while helping them to make informed financial decisions. Service providers such as Close Brothers also supply e-Learning platforms, where employees can easily access practical financial education in a way that suits their busy lifestyle.
3. Discover what your employees really want and revise your company’s benefit schemes
Financial wellbeing strategies should begin with your employees, their needs and their struggles. To find out what employee benefits are helping and what you could be doing better, survey your employees to gain valuable insight. Offering employees a financial health check that can help diagnose where exactly people are struggling can help you then build a tailored programme of financial education. This way you can target pain points, which will create a much more effective financial wellbeing strategy. It will also ensure you get maximum employee buy-in to your financial education efforts.
4. Employee voucher and discount schemes
You can help your employees by introducing tailored employee voucher and discount schemes. These perks save employees money when they shop through the scheme, they will improve the financial health of your employees and they will ultimately help to improve employee loyalty and retention. Such schemes can be built into your employee recognition and reward programme.
Perks such as this help employees with financial wellbeing and they can also be a huge motivator. But, as always, make sure you do your research. Find out what types of discount schemes and vouchers your employees are interested in. Where do they shop and where do they spend their money? A one-size-fits-all approach is not likely to reap great results.
5. Increase pension scheme contributions and financial education
Here in the UK, we’re lucky in that much of the leg work is done for us when it comes to pensions. Thanks to auto-enrolment, our pension contributions are taken straight out of our pay cheque and stashed away for when we’ll need it most. But forward-thinking organisations are going above and beyond, helping employees understand how to get more value out of their pensions.
Many employers offer higher employer contributions than the required minimum. Taking such action will show your employees you are invested in their future and that you care about their financial wellbeing. It will be a draw for prospective employees and, importantly, it can act as a retention incentive. Why would an employee go elsewhere when they are happy with your organisation and they are building a considerable nest-egg for their retirement?
Companies should also consider offering pensions advice for younger generations, so they fully understand the benefits of investing for their retirement at an early age. One source shows that over one-quarter of Brits aren't aware of their workplace pension scheme, while the BBC shows that there is a significant gap between expectation and reality when it comes to expectations of retirement behaviour. If you want to go above and beyond for your employees, their financial education and their overall financial wellbeing, go the extra mile and offer pensions advice your employees will understand and appreciate.
6. Salary sacrifice schemes
One way to meaningfully improve the financial wellbeing of your employees is to offer salary sacrifice schemes. These are tax-friendly incentive schemes that allow your employees to save money, usually on tech or other goods they were going to buy anyway. For such schemes to be effective, they need to be appropriately communicated and they need to be tailored to the employees at your organisation. Give your employees a real reason to opt for the salary sacrifice scheme and they will, most likely, take advantage of the financial perks you’re offering.
7. Salary savings schemes
Incredibly, millions of Brits have no savings to cover them in case of emergency. One-quarter have no savings and 33% of British adults don't regularly save money. You might consider offering a workplace savings plan, which will allow employees to begin actively saving for a rainy day, providing them with a financial safety net. Such a scheme might involve small payments coming directly out of their monthly pay. Certain companies offer this type of scheme and link it to company business objectives. This means employees receive a bonus (and extra motivation to do great work!) on top of their savings.
While these steps are a great start when it comes to improving employee financial wellbeing, employers should make efforts to continually assess and revamp their financial education initiatives and financial wellbeing programmes. The start of the New Year is an ideal time for staff and employers to re-evaluate their financial concerns and commitments, while considering what can be improved to help employees take their minds off their money worries and back onto their work.
Discover how we can help your employees with their financial wellbeing. Get in touch today to learn more about our financial education services.