According to The Money & Pension Service, financial wellbeing is known by many names – like financial literacy, wellness, confidence or resilience – but put simply, it’s about having a good relationship with your money.
A financially healthy workforce is beneficial for businesses and in turn the economy.
It's well-known that emotional and financial wellbeing are connected. By being in a poor financial situation, people are much more likely to experience feelings of stress and worry, causing sleepless nights, which can lead to poorer performance at work and with relationships with colleagues. Ultimately, this can also lead to greater levels of absenteeism in the workplace which then places extra stress on other staff and so the cycle goes on.
It is a common misconception that financial wellbeing is purely about pay. Whilst money worries tend to become less as income rises, high earners, are just as likely to have as many financial worries as someone on a much lower income if they have little savings and a lot of debt. Financial worry is not necessarily directly linked to pay.
Employers benefit from their workforce having good financial wellbeing, as they are likely to be more productive at work. In 2018, according to The Money & Pension Service website, 11% of UK workers reported they had experienced a fall in productivity at some point over the preceding three years as a result of their financial situation.
Employers are uniquely positioned to deliver money guidance around life-changing events such as changing roles, relocations, starting a family and entering retirement.
For employees, financial wellbeing is becoming more important, especially in the cost-of-living crisis. For employers, having a workforce that is engaged, informed, supported and efficient will improve productivity, it can also help to improve staff retention, and thereby also reduce costs and provide benefits in other ways. If employees can see their employers supporting them outside of their pay and immediate other benefits structure they clearly feel more valued, it’s no wonder they go hand in hand. By understanding these issues employers will go a long way towards building trust with their employees.
Armstrong Watson’s Financial Planning team is experienced in providing financial education and welling support through financial wellbeing programmes, specific to employer and employee needs.
We can deliver a range of seminars, workshops and/or webinars including, for example, advising pension scheme members; providing employees with an overview of their scheme to enable them to obtain a clear understanding of how it works, their options and any risks involved.
Understanding employee needs and feedback through a colleague survey can provide valuable insight for an employer and help them to understand the information and support their employees value the most. A survey of this nature will help an employer to decide the type of financial wellbeing programme to run.