How to ensure your mental health and financial wellbeing approaches complement each other
Poor financial wellbeing can have a significant impact on employees’ mental health and emotional wellbeing. The cost of living crisis has heightened anxiety and stress, with Wagestream’s The State of Financial Wellbeing (2022) report revealing that 70% of employees are now worrying more about money, and 76% of these are suffering from worse mental health as a result. These are frightening figures, demonstrating the close link between financial and overall wellbeing.
Further research from Wagestream suggests that there are big disconnects between what employers think their employees’ have in savings and the reality – 35% of employees have less than £500 of savings – a figure that employers think is 15%. Meanwhile, research by One Medical has shown that 69% of employees would choose one job over another if it offered better benefits.
Such statistics demonstrate that it is crucial for employers to consider how their benefits packages are supporting financial wellbeing.
Key ways to help reduce financial pressures
- Financial education enables employees to gain control of their money and make good financial decisions around key areas such as spending, saving, borrowing and planning. Providing this type of financial support can be hugely impactful.
- Discount platforms can help to reduce the impact of inflation with supermarket and other retailer discounts. Benefits such as these can make a big difference in extending employees’ disposable income, without a big expense to your organisation.
- Debt support. Unfortunately debt problems are on the rise, but there are many resources that employers can signpost to. An Employee Assistance Programme will typically offer a confidential counselling service to tackle the impact of debt, while Money Helper funds charity-based debt advice across the UK.
- Health benefits can also improve financial wellbeing. These can reduce the cost of medical expenses such as visiting the dentist and purchasing glasses, whether through a cost reduction, contribution scheme or ability to spread costs, these can all lessen the stress of a large, unplanned expenses.
Communicate to ease the pressure
All of these benefits can reduce everyday costs, relieving some of the pressures associated with the rising cost of living. They are typically underused by employees, often due to lack of awareness, and so communication is vital to ensure maximum engagement. This enables employees to make the best use of the benefits available to them and optimise their financial wellbeing.
A common theme identified across employers is a need to engage and communicate with employees about the issues they face. By doing so, and actively communicating the benefits that are offered, you can support the financial security of your employees. Whether it’s helping your workforce save for the future or cover unforeseen medical expenses, financial wellbeing support is a huge contributor to overall wellbeing.
Beyond the day-to-day
Yet financial wellbeing is not only about day-to-day issues. Medium-term security, or lack thereof, can keep people awake and add to anxiety.
The ability to work is crucial to someone’s financial and mental wellbeing. Ensuring that people can return to work and not suffer reduced earnings capacity for too long, not only reduces the impact of absence on the company, but also on the individual.
Group income protection and life assurance can provide peace of mind to employees. Furthermore, with many providers also offering the option to include dependents, employees can extend cover to their partners and/or children, providing financial security to the whole family and extra peace of mind to the employee knowing that their family can be protected against the worst possible outcomes.
We all know that looking after your employees’ financial wellbeing is key to any organisation’s success. But we need to do a better job of putting this into practice, and showing employees how their benefits can help. It’s time to connect the benefits in place with the problems they face.
In partnership with Buck
Buck is a global, integrated HR consulting, benefits administration & technology services provider.