- Financial wellbeing
- 5 minute read
Most of us end up spending far more over the festive period than we intend to, especially with the growing temptation of Black Friday and Christmas deals. Good intentions of being more frugal or preparing earlier next year always seem to get lost along the way.
Relying on credit without a clear plan of how to pay it off can get to be a real problem, leading to stress, anxiety and ultimately lost work days. The average UK family spends over £800 more than usual at Christmas, and that doesn’t include Black Friday expenditure. Financial worry is only one seasonal stress - add to the mix the constant social pressures, preparing for festivities, attending children’s school activities and hosting or travelling to family and friends. When more than three quarters of the 94% of employees who admit to worrying about money say that financial worry impacts them at work, we can’t expect a Christmas miracle of productivity.
Money worries reduce employee performance
Research shows that money worries are one of the single biggest causes of stress and so it’s no surprise that financial pressure reduces employees’ productivity across a wide variety of indicators. This adds up to a perfect storm of underperformance which costs the UK economy an estimated £120 billion, as well as impacting employee mental and physical health. Staff with scarcity mindsets caused by constant financial worry have less mental bandwidth to devote to innovation and creativity - two vital factors for business agility. And even if your staff aren’t among the 8% of employees who take time off work because of financial stress, those still standing may be one of the 19% of employees who lose sleep over it.
Six ways to help your staff survive Christmas
How can you help your employees improve their financial wellbeing around Christmas? Here are six things to consider:
1. Acknowledge the problem
Don’t be afraid to bring the cost into the open. Christmas is the perfect time to start a corporate conversation about financial wellbeing. Acknowledge that Christmas can be difficult for staff and show that you want to make it as stress-free as possible. Use personalised internal communications and give staff the opportunity to share their concerns and to feedback about the type of support that would work for them.
2. Plan all year
The Christmas financial pinch point rolls around every year with monotonous regularity, but the good news is that this regularity makes it easy for savvy employers to plan. At your next planning session, include Christmas stress-busting initiatives in your financial wellbeing strategy or employee benefits scheme. Of course, you’ll offer these initiatives to all staff of any faith or none, whether or not they celebrate the festive period. Create a series of holiday-themed reminders, planning tips and budgeting tricks to communicate to staff throughout the year, as an intrinsic part of the cyclical process of your wellbeing communications strategy.
3. Empower your staff with financial skills and knowledge
Help your staff develop planning and budgeting skills. These skills are the first step to financial wellness and will equip them with the capability and confidence to gain more control of their finances, including preparing for key dates in the year. Offering staff financial planning resources and support in a format that’s right for them is an essential part of any financial wellbeing offering. Whether you provide these through group workshops, coaching sessions or self-learning digital programmes, even basic financial planning and budgeting skills will help your staff gain a clearer picture of their seasonal spending.
Giving employees the skills to create an action plan to tackle spending and curb Christmas debt will lessen their anxiety and improve their resilience, helping build a dynamic and energetic workforce, capable of adapting positively to change.
Even small changes of behaviour can provide momentum. Encourage staff to practice Christmas-specific planning and budgeting skills, such as:
- Buying Christmas cards and wrapping paper in the January sales
- Making the decision to send e-cards rather than paper Christmas cards
- Proactively managing children’s expectations
4. Start saving for Christmas in January
Consider providing your own version of a Christmas savings club, giving staff the option to save each month towards Christmas through your pay scheme. Avoid traditional Christmas savings clubs, as these aren’t protected by the Financial Services Compensation Scheme and there’s no interest earned on any money saved. Yes, staff could arrange their own do-it-yourself Christmas savings scheme but making saving easier and more streamlined for them shows you value their financial wellbeing. People who feel valued have higher levels of engagement.
Also consider signing up to a staff discount scheme with supermarkets, retailers or charities to help reduce the cost of Christmas essentials.
5. Manage your culture
Influence your corporate culture so that less is expected or required of staff financially at Christmas - but don’t forget to consult staff. Some people may love the glitz and pampering of your annual black-tie staff Christmas party, while others might feel pressured to attend and buy a new outfit that they can’t afford. Your Christmas party is a “thank you” to your staff and important for employee engagement, but consider additional ways to say thank you that might put less pressure on people.
- Reminding staff of the availability of your Employee Assistance Programme, if you have one, which can provide a confidential space where employees can talk about their anxieties, including money worries
- Capping Secret Santa gifts at £5 or less, or choosing a charity shop challenge
- Ditching Secret Santa altogether
- More relaxed, dress-down Christmas get-togethers
6. Reduce other stressors
To reduce the overall burden of festive stress, consider chipping away at non-financial stressors, too. Possibilities could include:
- Giving more flexibility to work from home, to reduce commuting and increase time for Christmas preparation
- Asking staff if they’d prefer a Christmas party or a day off
- Sensible scheduling of work
- Not expecting staff to do the same amount of work in less time
Christmas-proof your workforce
Financial education is likely to be the last thing on anyone’s Christmas list, but it may be by far the most useful and insightful gift an employee can receive. Recent evaluation of one of our financial education programmes found a:
- 79% average increase in knowledge
- 76% increase in employee confidence in making financial decisions
- 75% increase in the likelihood of staff making a change to their finances
To find out more, or if you have any questions about Christmas-proofing your staff, request a call back.