Why you need to make employee financial wellbeing a priority
With the end of the financial year fast approaching, it’s a good time to think about employee financial wellbeing. Studies show a direct link between financial stress and physical health, emotional wellbeing, and ultimately, workplace productivity. Stress caused by pay levels, an inadequate level of financial literacy or an absence of employee benefits can affect work performance.
In fact, according to the 2017 CoreData/Financial Mindfulness Financial Stress Survey, nearly one in every three Australians feel financially stressed. And it’s a problem that affects all socio-economic groups.
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Money worries impact an employee’s ability to do his or her job, affecting job performance, their ability to concentrate and make the right decisions. This can also lead to a significant negative impact on their colleagues. If an employee is unable to concentrate on tasks, their productivity and quality of work suffers, presenteeism and absenteeism rises, and workplace accidents are more likely to happen.
Security and confidence
Employee financial wellbeing is such an important factor contributing to your people’s sense of security and confidence. So, as an employer, you have a vital role to play in making financial wellbeing an integral part of creating a healthy workplace.
The start of the new financial year is a great time to encourage employees to look over their financial arrangements. By helping them overcome financial stress, you can create an environment where your people can reach their potential and make a significant contribution to your company’s performance.
Starting an Employee Financial Wellbeing Programme
It’s important to recognise that not all employees will have the same financial wellbeing needs. To tailor your content to specific financial needs and issues of employees, you’ve got to think about factors such as their age, type of work they perform, and lifestyle.
For example:
Younger Millennials – people aged 18–25
Employees in this age bracket are likely to be starting their first job and typically face particular financial challenges, including:
- Learning to budget
- Managing credit
- Paying accommodation bonds and household bills
- Paying back debt from education
- Understanding employee benefits
- Saving for future financial goals
Older Millennials and Younger Generation Xs – people aged from late 20s to mid-40s
Employees in this age group may have a young family to support, and need to balance demands and costs of childcare, along with rent or mortgage payments and lifestyle choices. Typical financial challenges include:
- Ensuring adequate income protection to mitigate against adverse and costly life events
- Saving for future financial goals, such as private education
- Salary sacrificing for professional development and career growth, or for novated car leasing
- Making additional super contributions
Older Generation Xs and Baby Boomers – people aged in their late 40s onwards
Employees in this age group tend to be thinking about life beyond the workforce and maximising their retirement savings. Their particular financial challenges may include:
- Maximising retirement savings
- Securing an income for later life
- Handling unexpected life events; such as ill health, or the death of a partner
Putting employee financial wellbeing on your Corporate Social Responsibility (CSR) Agenda
As your first steps to implementing an employee financial wellbeing program, encourage your employees to start talking about their personal finances:
- Set up a system to allow employees to post anonymous questions or concerns about personal finances, and hold regular group financial education sessions to tackle the questions raised.
- Support employee financial wellbeing by offering financial workshops on budgeting, insurances, superannuation planning, and so on.
- Invite a financial expert to deliver a group seminar or individual sessions to give your employees a good understanding of the best ways to get ahead.
- Work with a partner who offers online financial education through webinars or other e-learning technologies.
- Offer a range of financial employee benefits that help your employees stretch their salaries further (such as special rates on income protection and life insurance policies, along with other lifestyle discounts, novated car leasing, and so on).
As a HR professional, think about creating a comprehensive communication strategy to ensure your employees are aware of the financial wellbeing benefits available to them, how those benefits can help them, and how they can access them.
Get started now
Using Flare Workplace Services and Platform, you can improve your employees’ financial wellbeing and reduce financial stress by customising your employee benefit offerings based on their specific needs. You can also provide your employees with access to the best benefits at no extra cost to your business.
See for yourself how our platform can help you improve your employees’ financial wellbeing.
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