How to help employees improve their financial resilience
Over the last year, costs have been on everyone’s mind. Prices have increased by an average of 6.7% in the UK. Meanwhile, 12.8 million adults are now living in debt, an increase of two-thirds in six years.
Financial struggles have a heavy impact. They cause stress, anxiety and even depression. They bleed into individuals’ work performance as they lose sleep and focus.
This can create more problems. One person’s errors can trigger more stress, both operationally and by affecting team morale and cohesion. Put simply, financial anxiety affects an organisation’s bottom line.
It’s good for business
Working to improve the financial resilience of employees benefits businesses. Financial resilience boils down to three things:
- Understanding finances and how to manage them
- Earning enough to meet your needs
- Adapting to changing circumstances
Where businesses can step in to support employees – over and above investing in reward – is by working to build financial understanding. As Standard Life discovered, people who know how to plan their finances effectively feel almost three times more positive about their finances than non-planners.
By supporting employees to build financial understanding, you increase their ability to plan, which develops financial resilience. This tangible support for wellbeing prompts employee loyalty, aiding engagement and talent retention. It can also make employees more aware of the value of other financial benefits you may offer, such as share plans or pension schemes. All of this further enhances financial resilience.
Here’s how you can create and communicate the resources that will embed greater financial resilience among your employees:
Understand your employees
Start by understanding the financial needs of your employees. This means exploring what they know – or don’t know – about financial management. The World Bank estimates that around one-third of people in the UK are financially illiterate.
Use surveys, workshops and interviews to gain a fully informed picture of employee financial knowledge and priorities. look out for life-stage and generational differences.
Think about resources to offer
Analyse your data to see what information or support will be the greatest help to your employees and to assess how that could be provided.
You could invest in creating dedicated, internal resources and learning and development opportunities, such as:
- In-person workshops
- Financial webinars delivered by in-house experts, or by dedicated external providers
- A financial resilience mentoring programme
- Networks of financial wellbeing first aiders
- Money clinics with a visiting financial adviser
- Employee assistance programmes to signpost support
- Visiting mortgage advisors
Or you could point to external resources, via a financial resilience hub, which is a dedicated place for your people to discover and explore:
- Articles
- Explainer videos
- Links to expert advice from third parties like Citizen’s Advice, Stepchange, or the Money and Pensions Service
Communicate your support
Whatever support you’re offering, it has to be communicated sensitively. Worries about money can cause fear, shame, and avoidance. Plan a small-step, cumulative campaign, which builds engagement and momentum.
Start by training managers to understand how financial anxiety can affect employees, and how they can best normalise the conversation around building financial resilience. Ensure that they themselves have financial resilience and that they understand the tools and resources available.
Introduce communications that focus on making financial resilience a clear concept for employees. This should support employees in understanding what financial resilience is, how they can build it and the benefits it brings. Communicate in a way that’s simple, friendly and inclusive.
You may want to consider bringing in employees to talk about financial challenges they have faced and how they dealt with them, or about how they manage their budgets.
The final step is to communicate your resources: what they are, how they support employees and how employees can access them. Consider linking bitesize communications to moments when people focus on their finances. For example, include a short video about an aspect of financial resilience with every payslip – how to set up a budget, plan a pension and understand interest rates.
Building the employee financial resilience is a long-term goal. Think simple, steady, supportive – and keep listening to what employees need.
To find out more, click here.
In partnership with Caburn Hope
Full service internal communications and employee engagement consultancy.
