Improving employee financial wellbeing

Estimated reading time: 4 minutes

Imagine the scene. You’re worried about a health condition so you make an appointment to see your doctor. It’s important to be reassured that the symptoms are nothing serious. So you arrive at the surgery, sit down with your doctor and . . . silence. You want her to guess your symptoms!

Is this a likely scenario? Hardly. You will open up like a book to them and talk about the most embarrassing of conditions or concerns without hesitation. Why? Because you have a problem and you want to be cured or the pain alleviated. Importantly, you also have trust in your doctor and are happy to share with them, in the knowledge that your symptoms are not going to be made public.

How does this relate to employee financial wellbeing?

It is clear from a number of research surveys that a significant proportion of the workforce are struggling with symptoms caused by their financial concerns, such as stress and sleepless nights.

These worries are directly impeding their day-to-day ability to function in the workplace, which subsequently impacts their lives outside of work. Unfortunately, many believe they have no doctor or confidant to turn to. Discussing money really does remain a taboo in the UK, as a current TV advert for a major bank highlights so well.

According to Barnett Waddingham’s Generation WHY? 2018 research, a significant proportion of employees are dealing with financial issues of one sort or another. 

  • More than 25% are dealing with problem debt
  • 60% only have access to savings that will last three months
  • Fewer than 10% contribute a total contribution level that will help them create a reasonable sized pension
  • 52% of under 30s see their financial priority as 'just getting by'
  • Only 15% of employees feel that their organisation’s profits are shared evenly

Most people have no idea who to talk to in order to help tackle this problem, but as it is directly impacting their productivity at work, this presents an opportunity for employers to step up.

Of course, we shouldn't be naïve. Only a small percentage of employees (7% according to our 2018 survey) trust their employer enough to share their concerns. However, it is in your interest as an employer to help and you can do so without breaking the bank. The ACDC approach (Ask, Create, Deliver, Check) is an easy way of putting a financial wellbeing plan together.

Use a survey to ask your employees what keeps them awake at night. It’s a simple yet powerful way of gaining qualitative data and real insight about their concerns for the Today, the Tomorrow and the One Day.

Layer up multiple sources of evidence if you wish to dig deeper, using quantitative data, including organisational data (e.g. attrition, absence records, EAP data). Apply external benchmarking and big data, such as postcode, social indicators and household debt.

Once you have used the survey to diagnose the issues within your workplace, a treatment framework can be created that offers a matrix of prescriptions or solutions. Each employee can then access this to get the help they need. This is much more effective than offering a single product which might meet the needs of some but not all. In the worst case, this is just a sticking plaster which masks or delays the issues rather than solving them.

As with medicine, there could be more than one solution for the same issue, dependent on factors such as personal history and the degree of risk the individual is prepared to take. We can see this clearly in the example of debt.  Solutions can vary, depending on what the underlying issue is. For example, problems with budgeting and managing spend on an ongoing basis may benefit from financial education.  High cost lending, on the other hand, may require switching to a better product or indeed doing nothing and just keeping an eye on it (e.g. if it’s manageable debt.) If your solution is an internal one, you need to do some due diligence on any product solutions. This multi solution framework will offer an inclusive financial wellbeing benefit to all.

Just trying to review an ISA rate or evaluating the best credit card can be a time-consuming headache for employees. Delivering immediate solutions to employees and signposting them to reliable and trustworthy resources, either inside or out of your business, can save employees time and energy and provide fast relief to concerns over financial matters. This doesn’t need to be expensive. There are a huge number of free, reputable and accessible places your employees can go to gain resources, if only they know how. Even just being able to model their retirement outcomes in a way the employee can easily understand can be a relief from a previously unquantifiable worry.

Think about the most effective communication medium and how the message needs to land. Be creative and instigate debate, discussion and sharing via social media community groups. Advocate your objectives, ideally with personal examples from the top.

When you re-run a survey, twelve months down the line, you will be able to see the positive results of your efforts. Checking ensures that the strategy remains fit for purpose.

What's the cost of treatment to improve employee financial wellbeing? 

Cost is relative. You need only look at the results to judge its worth – reduced absence, increased engagement and satisfaction, greater inclusivity and fairness, and, of course, higher productivity.

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