Financial Wellbeing in the Workplace
- by Career Moves Group
- 28 Jan 2019
Personalised approaches to assist employees better manage their finances can prove a sensitive and practical means to increase engagement.
In today’s active market, turnover increases as employees consider seeking new positions with increased pay if they feel their current package is not working. Yet offering practical recommendations that provide the knowledge necessary to conduct informed decisions can encourage employees to adopt better financial wellbeing management, whilst increasing their productivity and decreasing money associated anxiety, long-term stress, physical health issues, and absences from work.
Financial wellbeing varies from employee to employee as personal financial requirements differ throughout the duration of a career, whilst some will be seeking debt and day-to-day cost management, others may be looking how to buy their first home, and then others may be concerned about retirement.
The educational tools surrounding each of these areas will vary and deliver differing practical solutions to achieve financial security and freedom of spending choices in their current situation, as well as in the future.
It is necessary to understand that financial wellness focuses on how wealth is managed, rather than the sheer level of income an individual has. Incorporating this into money management prepares individuals for their own divisions of costs and creates personal solutions that encourages employees to save and achieve their own financial goals.
According to a recent government report, ‘Building the business case for financial wellbeing’, 40% of adults say that they do not feel in control of their finances, only 28% of people have a savings buffer equal to three months’
income, and one third of employees state that financial worries are their biggest concern, resulting in negative changes in their sleep patterns and performance at work.
It seems that improving the employee experience through supporting wellbeing initiatives can increase attraction and retention rates through taking a leading position on helping employees’ money go further.
Developing a comprehensive and strategic approach to employee financial wellbeing, that understands the financial needs of employees, can align business priorities, timeframes, and available budget in order to build an appropriate financial wellness programme.
A holistic approach to personal financial wellbeing covers both the employees’ current situation, as well as planning for future financial requirements, which includes an savings allocated to account for potential future financial shock.
Short to long-term financial management can improve employee productivity and ease stress, a balanced financial wellbeing package should assist across the following areas:
Control over day-to-day finances
To assist with debt and income management, reduce overspending income, debt, and ensure that personal expenses are under control employers can offer seminars built on budgeting and cost allocation can help increase their employees autonomy in conducting their spend.
Future-planning and saving
Preparation for future financial shock can offer employees confidence in their current finances, whilst also counteracting unexpected situations later down the line.
Assisting employees in their design of an implementable savings process that is personalised to employees’ own financial initiatives and goals demonstrates clear employer investment in their employees as individuals outside of work. Investing in this initiative can improve an employees’ work-life balance whilst relieving latent money stresses.
Financial freedom to make choice
Providing access to resources and financial guidance that support spend-planning through running financial MOTs, advice on retirement decisions, financial-health scoring, personal reviews, as well as online resources all contribute to employees being able to make their own informed spending choices that make their income go further.
Direction to meet financial goals
Additional support that keeps individuals on track to meet their financial goals manages the end-to-end financial wellbeing programme that ensures both employer and employee are gaining the full and sustained benefit from an implemented strategy.
The goal of these programs is to drive change. Once productive steps forward have been established, and employees are dedicated to taking the steps, employers need to empower action and encourage staff to continue in their efforts. This can be managed through financial reviews focused on the deliver of desired results.