Employee financial stress is at an all-time high. Up to 60% of employee state that their personal finances are their primary cause of stress. Their financial worries far outweigh other key stressors, and these are having a negative impact on their work performance.
According to research, employees going through financial stress tend to be less productive and more distracted at work. Financial stress has also been linked with a higher rate of absenteeism and presenteeism (but not fully functioning). An average employee spends at least three hours per week dealing with their personal finances at work. Up to 31 days of productive work time is lost every year by an employee worrying about their finances. Businesses can go for commercial bridge loans, but an employee can’t when in financial trouble.
Employee financial stress is a major issue affecting many workplaces in the US and employers can no longer afford to ignore it. It is reported that businesses in America lose more than $500 billion each year due to lost productivity associated with financial stress. This translates to about 2.5% of the U.S. gross domestic product (GDP).
On the bright side, many employees are willing to seek and accept help dealing with their financial stress – and input by their employer is highly appreciated.
Employers are in a well-placed position to positively influence the lives of their employees by helping them lower their financial stress. Here are four key ways you can assist:
Promote financial wellness
According to research, when properly structured and implemented, financial wellness benefits can help lower employee stress, improve productivity, boost retention, and enhance your business’s ability to attract and retain top talent. Over 74% of employees agree that financial wellness is a crucial benefit and 60% state that they are more likely to stick with an employer who provides a financial wellness program.
A financial wellness program is an initiative designed to help employees lower their stress and anxiety by assisting them to better manage their day-to-day finances, save for their future, and prepare for unforeseen expenses. The first step to setting up a successful financial wellness program is understanding individual employee concerns. The best way of gathering this information is through anonymous surveys. This will help you customize the program according to their needs.
However, you should note that financial wellness isn’t a one-size-fits-all affair. You require different solutions and levels of attention for different situations.
Financial wellness programs help employees reduce their financial stress and improve their employee’s fiscal health over the long term. However, in some cases, employees may be in situations that require immediate attention to minimize the stress caused. 31% of employees desire personally tailored advice regarding their money worries. Bringing in experts, such as financial advisors, to meet with your employees can be very beneficial when it comes to managing financial stress associated with common issues such as repairing bad credit, medical bills, saving and budgeting, and planning for retirement.
Encourage employee engagement
You can reduce your employees’ financial stress by actively engaging employees in your financial wellness program. Given that boosting financial security involves behavior changes, ensure that your financial-wellness program is inspiring to your employees. Put up milestones and quick wins, for example, setting up a budget or unsubscribing from underutilized or unused subscription services using the savings to settle debt. This will help employees stay motivated and accountable. Your employees should also be able to easily access the program. Put in place a financial wellness program that has online tools that are compatible with both desktop and mobile devices.
Encourage employees to save more for retirement
Up to 60% of employees in the US are stressed about planning for their retirement. As an employer, you can help relieve this stress by encouraging your employees to exploit their plan’s tax benefits as well as any employer matching contributions. This is an excellent way to nurture lifelong savings behavior and enhance retirement readiness.
When coming up with ways to improve your employees’ mental and financial health, ensure to refer to these four tips. While employee financial stress is a growing trend, there are things you can do as an employer to improve your employees’ financial stability and well-being.
Granted, choosing and putting in place the ideal financial wellness program for your employees is not an easy process. Fortunately, our team can help you design the perfect program for minimizing your employees’ stress and give them more financial flexibility. Call us today to learn more.