Financial wellbeing is one of the keys to productive employees

When a colleague has been awake all night worrying about whether they can pay the mortgage, it’s bound to affect their work performance. That’s where employers can help

Most business leaders would agree that productivity levels are at their highest when employees are in the best of health. There is a lot of evidence that poor physical and mental health leads to reduced productivity, increased absenteeism and presenteeism – but perhaps less for financial health.

But consider these three stats from our research:

Three out of four employees say not having savings is a worry
Two out of three employees say money worries affect their mental health
Three out five employees say money worries affect their work performance

And most employers – nearly 90% – agree that money worries affect their employees’ overall performance.

In a nutshell, an increased focus on money worries translates to a decreased focus on work. And so it only makes sense that the more employers can do to help employees with their finances, the more productive they are going to be, which ultimately means an increase to the company’s bottom line.

Money worries are never far away

Regardless of income level or amount someone has in savings, everyone is on what might be described as a ‘money worry timeline’. If they are struggling to pay the mortgage this month, that’s what’s keeping them awake at night. On the other hand, if they are managing today’s costs, their focus turns to next month, next year or even further ahead.

Money worries are both immediate and future based and both affect productivity. And for any financial wellbeing programme to be successful it needs to address an employee’s entire financial life.

The whole point of a financial wellbeing programme should be about getting them to feel confident about their finances – that they can meet their current financial obligations, but also feel secure about their financial future.

Real-world education

A financial wellbeing programme needs to start and finish with topical and engaging education. That means education that deals with real life issues in a practical way so employees can take action – for example, instead of educating employees about savings products, wrap it up into a needs-based subject such as ‘how to get on the housing ladder’.

That means addressing everything someone needs to know about buying their first home, including saving for a deposit. In other words, it’s about providing the wider context rather than honing in on one part of a much bigger issue.

If employees then want more details on specific issues like saving for a deposit, provide a separate education piece around this and signpost or, better still, provide a solution, such as a savings product or individual one-to-one guidance or advice sessions.

Make it engaging

Engaging means making it real, useful and available when someone needs it. This last point is so important.

For example, many employers, through their pension provider, run annual pension road shows which is great. But what if they're not ready to get engaged with their pension just then, but will be in six months’ time? Is it a matter of get involved now or wait another 12 months?

Successful education is both about alerting people, but also about making sure they can access they information when they need it.

There’s no doubt that the cost-of-living crisis is affecting all employees in different ways – some will be worrying about costs today while others will be more concerned about the future. A good financial wellbeing programme will address both concerns and help get employees more focused on their jobs.