Imagine it’s Monday morning. You have your coffee and you’re all ready to go to work, when your car won’t start. The tow truck takes your car to the mechanic who quotes you $600 for the work you need. Today, 63% of American adults (nearly two out of three) do not have $500 in savings to deal with such an emergency, according to a study from Bankrate. Despite being fully employed with a steady income, they still have no access to affordable credit.
With statistics like that, there is a good chance the person in the story above could be your employee. But unless you have been in this situation yourself, it’s easy to miss its inherent Catch-22. In the current system, you need credit to get good financing. But you had to have had a loan or a credit card to start building credit.
Difficult to Discuss
This crisis has rippling effects across the workplace and the economy as a whole, but for several reasons, it is rarely discussed. Financial wellness is a big part of the mental and emotional health of working adults. Admitting one’s struggle is a vulnerable act fraught with potential risks, both social and financial. Asking for help from an employer is inherently intimidating, as anyone who has asked for a raise will tell you. It could lead to rejection or, in a worst-case-scenario, termination. Furthermore, some may feel embarrassed or humiliated by the need to ask for help.
But in many cases, inaction is worse for all parties involved. Money problems lead to stress, negative emotions and distractions that affect employee productivity. If financial stress begins to affect the quality of work, the additional fear around job security is liable to trigger a downward spiral. For the sake of all involved, it’s best to talk about financial unwellness and arrive at a solution. Luckily, with a bit of economic empathy, this can be a positive transformational experience for employer and employee alike.
Empathy Unlocks Trust
The more you understand the struggle and remain sensitive to the insecurities of those in financial hardship, the better you will be at creating a safe container where they can open up about their problems. This, in turn, will help lead you to the appropriate solution and an improved relationship with your employee.
This is a practice we put to use. By the time we initiate the financial conversation with our team members, it’s already clear that we are on their side, ready to serve them — not make a buck off them. Our business allows employees with paid time off or vacation days to have access to funds whenever they need it, regardless of their credit at zero-interest. We also help employees improve their credit score. Their job is essentially their credit. These low-cost, easy-to-repay loans help them attain financial stability. In doing so, we’ve shown a fundamental understanding of their problem and addressed it with the very design of the loan system.
With their concerns over being exploited taken off the table, the stage is set for conversations of trust. Having drawn from our empathetic insights we anticipate their anxieties. Now, any conversation can proceed much more smoothly.
Leading With Authenticity and Transparency
A safe container needs trust, transparency, authenticity respect and emotional safety. Once a foundation of trust is established along these lines, we can engage these customers in a transformational way. Stories make for a good start.
When meeting potential borrowers, I like to start off with my own. When I first moved to the U.S., I was in a tough financial spot. I was credit invisible in the U.S. banking system, I was unable to get approved for a credit card or a loan, thus unable to build my credit. My inability to access low-cost loans put me at a significant financial disadvantage and risk.
Sharing this story lets my audience know they are not alone. It brings me down to earth from my position as president of my company and reveals that I too am a real person with real problems. That authentic sharing puts my own image on the line and sets the tone for the sharing to come. It signals that we’re safe — that they can let their guard down without having to worry about repercussions or being lectured. We’re laying all our cards out on the table, letting them know that we’ve been there too, and we’re here to help.
Every situation will call for slightly different tactics and approaches. Using our own, HoneyBee finds our customers are more than happy to open up about the troubles they face. The results empower them to regain control over their financial future. They become more loyal, focused employees at work. With a little empathy, everyone wins.