What is financial anxiety and how does it affect you as an employer? Financial anxiety encompasses anything related to an individual’s financial wellbeing that causes them to worry. With a fall in real wages and many employees facing unexpected expenses, it’s no surprise that 30% of UK employees are worried about meeting their day-to-day living costs. This anxiety has a material impact on how they go about their day, with 25% of people admitting to money problems so substantial it affects their job.1 Employers need to stop sweeping these issues under the carpet and step up to the mark!
So what can you do to help your employees? Here are three top tips to get you started.
1. Identify the problem
Financial anxiety is indiscriminate and can affect anyone, regardless of wealth. With this in mind, try to uncover the issues your employees are facing. These can be anything from struggling to pay rent, debt repayments or keeping up with day-to-day living costs. One way to do this is to use our Litmus Light Touch research proposition to find out where the financial pain points are within your organization.2 Once you’ve identified the predominant factors causing your employees financial anxiety, you can build out a tailored strategy to tackle these head-on.
2. Educate to alleviate: the power of financial education
Our research found that 88% of employees are open to using financial education products from their employer.1 Financial education doesn’t have to mean a huge initiative, it can be as simple as educating your employees to be more aware of their financial position. This can be done through coaching sessions, mortgage advice clinics and rolling out budgeting tools. If you get your people into a good savings habit they’re unlikely to stop, a great example of this is the success of pensions auto enrollment. 72% of people who don’t know where to start with their finances constantly or often worry about meeting everyday living costs, whereas those who are aware of their options and feel they can make informed and confident financial decisions are less likely to feel anxious.1 If you empower your workforce to understand their financial position, they’ll take control of their own finances, reducing levels of financial anxiety.
3. Engage your employees
Now you have financial education tools in place, the next step is to engage your employees! Make sure you deliver a range of financial wellness benefits for a spectrum of needs to maximize employee engagement. Relevance is key! This extends to the way you communicate your offering. Keep communications simple and straightforward to make it easier for employees to understand, and time them to coincide with key personal moments, such as buying a home, or periods of increased financial stress such as the run-up to Christmas. Or why not create a short video or hold some face-to-face sessions to bring your financial education to life?
By offering financial wellbeing support that’s easy to access, employers can lead by example in bringing awareness of these types of issues out into the open. This will not only help employees reduce their financial anxiety, but improves their overall mental wellbeing. Employees will be more engaged and productive at work if their financial worries are less of a distraction. If employees have the right tools to hand, they are in a much better position to manage their finances, stay in control and let go of financial anxiety.