Last updated September 2024
The ongoing impacts of the cost of living crisis in the UK have been making headlines for many, many months.
According to the Financial Conduct Authority, around 12.9 million UK adults have low financial resilience – that’s 1 in 4 of all UK adults.
With so many of us feeling the strain, it’s more important than ever for workplaces to focus on holistic employee wellbeing – and to step up and support their employees to become financially resilient. In this article we explain how.
Financial wellbeing refers to the overall security of individuals when it comes to their money matters.
Just like taking care of employees’ physical and emotional health, supporting financial wellbeing is crucial for creating a positive and productive work environment.
Employers must realise that their teams’ financial health directly impacts their productivity, mental wellbeing, and retention. Supporting employees financially can make the difference between a thriving, loyal workforce and one that is disengaged and on the verge of burnout. 
Money matters can have a profound impact on our mental health and wellbeing.
When financial concerns become overwhelming, they can lead to increased stress, anxiety, and even depression.
The constant worry about bills, debts, and making ends meet can create a persistent sense of unease.
This stress can affect various aspects of life, including relationships, work performance, and overall quality of life. The feeling of financial instability can even erode one’s self-esteem and sense of control, adding to the burden on mental wellbeing.
Everyone’s financial situation is different, so ‘good’ financial wellness will look different for all of us.
The Money and Pensions Service defines good financial wellbeing as feeling secure and in control of your money – now and in the future.
It’s about being confident in knowing you will meet your day-to-day expenses and can manage debt responsibly. It’s also about being prepared for rainy days and having achievable medium to long-term money goals.
Financially stressed employees are twice as likely to report poor overall health and are five times more likely to have lower productivity than their peers. As a result, it’s important to be able to identify the employees that need support and be able to address their concerns, especially during this period of high cost of living.
Supporting your employees’ financial wellbeing showcases your company’s commitment to holistic employee welfare and creating an organisational culture that cares. Employees who feel supported in managing their finances are more likely to feel valued and be loyal and committed.
Looking at the bigger picture, addressing financial wellbeing aligns with social responsibility and ethical considerations. It shows your organisation’s dedication to the wellbeing of your workforce – beyond traditional job-related aspects.
Financially stressed employees are twice as likely to report poor overall health and are five times more likely to have lower productivity than their peers.
It’s important to remember that the effectiveness of these initiatives will vary based on your company’s culture, employee demographics, and individual aspirations and needs. It’s essential to gather employee feedback through surveys and adjust your offerings to ensure they resonate with your workforce.
Paying a fair salary is undeniably the cornerstone of employee financial wellbeing. Be aware of ongoing economic changes, the cost of living and up-to-date market value salaries so you can pay your employees as fairly as possible.
By teaching budgeting, saving, and investing, these workshops will equip your teams with essential skills to manage their money wisely and reduce financial worries.
EAP programs offer a safe and private space where your team can chat with experts about their financial concerns. Through confidential counselling, individuals can receive tips on managing money better and techniques to handle stress caused by financial pressures.
Flexible work arrangements make life a little bit less hectic for employees and helps them ensure their work responsibilities and financial responsibilities can both be managed. It gives them the ability to find a balance between work and personal life, making everything a bit easier.
Student loan assistance will give your team members a way to potentially pay off their loans quicker – which will in turn give them a boost on their path to financial freedom and retirement. Plus, these programs often come with resources and tools to help your employees better understand and manage their loans.
Similarly to student loans, by offering retirement planning assistance, you empower your employees to make informed choices concerning their financial freedom for the future. Retirement planning enables your team to grasp the magnitude of saving, investment decisions, and the path toward realising their retirement aspirations.
12.9 million UK adults have low financial resilience – that’s 1 in 4 of all UK adults.
Surveys are an excellent solution to truly understanding how your employees are feeling financially.
By periodically collecting brief, targeted feedback from employees, you can gain real-time insights into the financial challenges and concerns faced by your workforce – and ultimately implement changes to support them. Here’s how to do it in five easy steps:
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