How to help with employee financial worries in the workplace
A robust financial wellbeing strategy requires three prongs: practical help for today, benefits to help staff save for the future, and the education they need to make the most of all of it.
For those struggling with debt, there's the opportunity to offer low-cost loans through the workplace. Benefits can also be used to bring down everyday costs. An employee discount programme, for example, can help staff save money on everything from Christmas presents to supermarket vouchers.
Help towards healthcare costs can be particularly beneficial, because it stops financial concerns getting in the way of people looking after their health. Health cash plans are a popular approach, as they will reimburse the cost of care, refund the cost of complementary therapy treatments, and offer a daily payment if employees need to go into hospital.
Employers can also bring down the cost of significant outlays like childcare, by offering them through salary sacrifice arrangements. This enables employees to take advantage of tax breaks and get more for their salary.
Addressing long-term financial concerns
A holistic strategy also needs to address more long-term financial concerns. A study by the Social Market Foundation and Neyber found that 48% of workers are not putting any money aside for anything beyond their regular bills, and almost one-third have no savings or investments at all. This means there's very little financial resilience in the face of the unexpected.
A workplace savings plan, such as a corporate ISA, can help employees build a savings safety net. For the longer term, individuals with robust pension savings are far less likely to suffer anxiety about their financial position in the future. Here, employers can consider offering more than the minimum pension contributions through auto-enrolment, and encouraging staff to make additional contributions through matching payments.
The third component is education. Options include everything from online tools to one-to-one sessions, seminars and written communications. Employers can go even further and offer access to financial advice. Where people are concerned about debts, they can be directed to charities offering debt advice, or their employer may offer debt counselling or guidance themselves, possibly through an employee assistance programme (EAP). EAP's often form part of a health cash plan offering. For broader financial advice, they may want to signpost the availability of advisers, invite them into the workplace, or offer subsidised sessions.
There is a clear business case for offering employees support when they are facing money worries after Christmas, and indeed for the rest of the year. The good news is that this does not need to break the bank. It can be simple, cost-effective, and according to a study by Barclays, if it succeeds in eradicating financial anxiety in the workplace, it could boost productivity by 4%.
Download our latest report 'The importance of addressing financial worries in the workplace' to find out what employers can do to support employees.Download now