Knowledgefinancial wellbeing

The importance of financial wellbeing & minimising employees’ money stress Sept, 2020

A recent study has shown a—long suspected—causal link between financial insecurity and mental ill-health. Most people experience stress in the workplace at some point, but when three-fifths of surveyed workers report mental health issues caused by money concerns, clearly something needs to change.

Of course, the burden of financial stress can be lessened by financial literacy,  budgeting and saving. But there are a lot of positive steps that an employer can take in order to help manage the stress felt by employees. Reducing financial stress in employees has multiple benefits to business – a reduction in absenteeism, increases in productivity and engagement, to name a few.

How does negative financial wellbeing affect employees?

There are lots of negative effects of financial stress. Money worries can leave people feeling undervalued and distracted.  It’s a constant worry and can lead to conditions like anxiety and depression. Money worries drastically affects the ability of employees to work happily and productively.  In the very worst cases, poor financial wellbeing can affect people physically. Not having enough money for housing, food or medication can have serious negative effects on an employees’ general wellbeing.

Reducing your employees’ financial stress

With over 60 per cent of employees in the UK experiencing work-related mental health issues, we estimate that it’s over 80% in Papua New Guinea. Improving employees’ financial wellbeing won’t magically solve every problem—but it’s a good place to start.  And – it’s all just part of being a socially responsible employer.

Employees aren’t the only ones who benefit from better financial wellbeing in the workplace. With our Family Matters financial training – the whole family benefits.  Management can also see gains, through improved productivity and morale.

  • Here are just a few ways that employers can help to minimise money stress:
    Provide financial education and guidance as part of a wider wellbeing programme.
  • Particiapate in workplace financial literacy education – like Savi Moni’s workplace program run by ABV.
  • Encourage employees to educate themselves as much as possible – see the Moni Savi page for articles, tips and tools.
  • Even understanding their payslip can be complex for employees—helping employees to understand their payslips can reduce the burden of stress.
  • Only work with responsible lenders to ensure employees don’t over-lend – putting great financial stress on not only themselves, but also their families.
  • Offer competitive salaries. This one might sound obvious—and expensive—but, it is worth the effort. If you’re seen to be active and generous, you’ll make your workers happier, and attract the best talent.
  • A good benefits package is a must. Performance incentives in the shape of bonuses, and clarity about pay bands are a great starting point.
  • Try offering flexible work schedules, to allow employees to put their finances in order – be it visiting the bank to set up internet banking or to pay out a high interest loan.

Help to give your employees the gift of financial wellbeing, minimising their stress and making life easier—and they’ll reward you with loyalty, focus and hard work.

Seizing the momentum, Mental Health at Work report 2018, Business in the Community