How technology could help deliver financial wellbeing at work
Even before the present cost-of-living crisis fully took hold, people up and down the country were feeling under pressure.
Standard Life’s Retirement Voice 2022 research reveals that almost half (49%) were cutting back on everyday spending and 58% were worried about running out of money.
Not only that, just 41% of the UK population said they felt positive about their finances.
Since then, the economic situation has become more challenging. This could stretch people’s finances to their limits and risks putting their financial wellbeing into a vulnerable position.
The impact of financial woes
Poor financial wellbeing can have a ripple effect on employees’ lives – and on businesses. Those worried about money are more likely to experience increased stress, disturbed sleep, and trouble concentrating, which could lead to poor mental health in the long term.
As a result, this can have a detrimental effect on employers. Productivity and performance levels could drop, and absenteeism could rise as a result of low financial resilience.
In fact, research by the CIPD shows that 28% of employees say money worries have affected their work performance. Meanwhile, an average of 4.9 worker days are lost each year due to financial distress.
On the flip side, good financial wellbeing can help employers build a more resilient business by reducing employee stress, preventing absenteeism and boosting performance and productivity. It could also give them a competitive edge over businesses that offer no financial wellbeing support, helping them retain and attract top talent.
It’s clear that supporting employees with their financial wellbeing should take top spot on employers’ agendas. Fortunately, insights show that many employers agree. In a recent Standard Life employer survey, nine in 10 said that financial wellbeing was important to them.
But how do you deliver a successful financial wellbeing programme? And how do you measure if it’s having a positive impact on your employees? This is where technology can help.
Technology solution
There’s no one-size-fits-all financial wellbeing programme. Employees need different support depending on their age, gender, life stage, and financial goals. The impact of financial worry differs too. Someone approaching retirement will have different concerns to someone who’s saving for their first home.
Employers need to build a programme of support that strengthens the financial resilience of every employee.
Technology like open finance and artificial intelligence (AI) can open the door to opportunities such as integration, data sharing, and hyper-personalisation. These can help employers create a financial wellbeing programme based on real user interactions, allowing them to tailor it to each employee.
Open finance technology allows employees to connect their bank accounts, pensions, mortgages, credit cards, and more into one place and see their finances in real time. This helps them get to know their finances and better plan for the future.
In addition, AI can streamline the delivering of personalised communications. Using spending activity data, captured through open finance, AI can send tailored tips to employees to help them manage their money and feel more in control.
Measuring performance
Of course, it’s essential for employers to understand if their financial wellbeing programme is working.
Big data and user insights can give employers the key to understanding if their support is making a difference, allowing them to track engagement levels and spot trends. It also helps employers make data-driven decisions on how to evolve their strategy as employee needs change.
Member insights tools, for example, use data and segmentation to track trends. It allows employers to see which groups are engaging with their pension and which are lagging behind. And based on these insights, employers can target specific groups with personalised financial wellbeing support and communications – helping improve relevancy and engagement.
Just getting started
Technology is making waves in financial wellbeing – and this is only the beginning. As the technology advances, employers can feel increasingly confident that they have access to the tools to deliver a financial wellbeing programme that’s measurable and based on real-life, real-time member needs.
For more insights on financial wellbeing, including resources on how you can help support your employees, visit our Financial Wellbeing hub.
In partnership with Standard Life
Standard Life are part of Phoenix Group, the UK’s largest long-term savings and retirement business. We both share an aligned ambition to help every customer enjoy a life full of possibilities.
