Supporting your Staff in Financially Challenging Times

Financial stress is a significant concern for many employees and employers in the current economic climate

As business owners, managers, and leaders, it’s crucial to understand the impact of financial wellbeing on your workforce and to take proactive steps to support them. August is Money Month in New Zealand, making it the perfect time to focus on financial wellness initiatives.

Why Investing in Financial Wellbeing Matters

Investing in the financial wellbeing of your employees can lead to numerous benefits for your organisation. A financially secure workforce is more productive, engaged, and resilient. Employees who feel supported are more likely to be loyal to the company. This reduces turnover rates, saving on recruitment and training costs and downtime due to loss of knowledge. Moreover, promoting financial wellbeing can enhance your organisation’s reputation as a caring, responsible employer, and a great place to work.

The Reality of the Current Cost of Living for Your People  

Many employees feel the financial pressure due to the increased cost of living. Recent reports indicate households are spending more on essentials like housing, food, and transportation, leaving less disposable income for savings, social and leisure activities. This financial strain can lead to stress, anxiety, and decreased productivity at work.

The ASIC and Beyond Blue Money and Mental Health Report 2022 found people experiencing financial challenges are twice as likely to experience mental health challenges and vice versa.

94% of people were concerned about the cost of living and not having enough money to support themselves or their family according to the Southern Cross Healthy Futures Report – Business Edition March 2023.

Understanding Financial Wellbeing  

Financial wellbeing isn’t only about having enough money to cover expenses; it’s about feeling secure and in control of your finances. While wealth might be about bank balances, net worth and how much you earn, wellbeing is about how our belief systems and relationship with money affect our overall life which is personal and unique to each individual.

Our financial wellbeing encompasses our ability to manage day-to-day finances, handle unexpected events, plan for the future, and enjoy life without financial stress. When employees have good financial wellbeing, they are more likely to be focused, engaged, and productive at work.

Current Research and Trends  

Recent studies highlight the importance of financial wellbeing in the workplace. According to the Financial Services Council, New Zealanders worrying about money either daily, weekly or monthly has hit a new high at 70%.

The NZ Commission for Financial Capability reports that three hours per week are lost in productivity due to money worries. Additionally, 52% of those surveyed want financial education at work and 37% say their health has been impacted by their financial worries.

Practical Steps to Support Your Employees  

According to the PWC Employee Financial Wellness Survey 2023, most employees want help with their finances. In uncertain economic times, employees must have access to trustworthy, objective resources and advice.
Workplaces are uniquely positioned to support staff through financial stresses by providing access to reliable information and stable employment. Many leaders want to help but aren’t sure how. Here’s how you can make a difference.

• Look at your data: Analyse the data you already have about your employees to understand their financial needs. Consider demographics and life stages: Are they mostly women, younger, single parents, or spread across the country? These details significantly impact their financial situations and needs.
• Education and Learning Needs: Financial literacy is essential for financial wellbeing. Don’t assume everyone knows how to manage their money. Organisations can help by providing resources and training on budgeting, debt management, setting up wills, power of attorney, insurance, and retirement planning. Share links to trusted sites like Sorted and major banks’ explainer pages. Offer guidance on payslips, tax, KiwiSaver options, fraud prevention, and cost-of-living tips through webinars.
• Leverage and Connect with Your Network: Utilise your existing connections, such as your bank, insurance company, broker, accountant, financial advisor, or KiwiSaver provider, for specific financial advice. Consider working alongside generalist financial wellbeing providers.
• Promote Open Conversations: Create a supportive and safe environment where employees feel comfortable discussing financial concerns. Encourage managers to check in with their team members and offer support where needed.
• Celebrate Money Month: Use Money Month in August as an opportunity to launch new financial wellbeing initiatives. Host events, share resources, and raise awareness about the importance of financial health. Partner with people from your networks, to provide a free talk or set up private drop-in booths for employees to get personalised advice onsite. These events can help to break down the stigma around money. The impact of helping someone talk directly with financial experts can be powerful.

Conclusion  

Supporting your staff in financially challenging times is not just a good thing to do; it’s a strategic investment in your workforce’s overall wellbeing and productivity. By understanding the reality of financial stress, promoting financial education, and implementing supportive programmes, you can help your employees navigate financial challenges and foster a more resilient and engaged workforce.

Ready to boost financial wellbeing in your workplace? Contact us today to create a tailored financial wellbeing plan for your workplace that supports your employees and strengthens your organisation.