Karleen Dowden, Regional Partnerships Manager, North East, Money and Pensions Service
The latest CIPD Reward Management Survey found that less than half of employers (49%) have a financial wellbeing policy in place – and calls on employers to recognise both the moral and business case for taking more responsibility for their employees’ financial wellbeing.1
When you look at the statistics, the business case is really clear:
• Almost 8 in 10 UK employees take their money worries to work – with money worries the biggest cause of stress2. • 4.2 million worker days are lost in absences due to lack of financial wellbeing – the equivalent of £626 million in lost output3.
£1.56 billion is the estimated cost of low financial wellbeing each year as a result of absenteeism and presenteeism4. With nearly 7 in 10 UK employers believing that staff performance is negatively affected when employees are under financial pressure5, the case for financial wellbeing at work is compelling.
We all know that employees are your greatest asset – and with 6 out of 10 employees considering financial wellbeing to be their employer’s responsibility, we must ask why more organisations are not investing in financial wellbeing.
Implementing a financial wellbeing policy doesn’t have to be resource-intensive
When implementing any policy, one of the first stumbling blocks is often not having the ‘buy in’ from senior management – however, over a quarter (27%) of respondents in the CIPD survey reported that senior leadership do see the need for a financial wellbeing policy but often lack the time, money or expertise. “Lack of resource” and “not knowing where to start” is something I hear time and time again when talking to employers about financial wellbeing, but fortunately there is a wide range of support and resources available.
A good starting point is the CIPD Practical Guide to Employee Financial Wellbeing which provides a good overview of the key elements for developing financial wellbeing in the workplace. You should be able to determine the key benefits of a financial wellbeing policy for your organisation and, ultimately, how it will support wider organisational goals and objectives. However, we all know that developing the policy is the easy bit but implementation is where the real hard work begins!
You don’t have to be a finance expert to support financial wellbeing
A common myth is that you and your HR team need to be the experts on ‘all things financial’ – the reality is you should act as enablers and facilitators, drawing on the expertise and support of other organisations to develop a financial wellbeing programme that meets your employees’ needs.
The Money and Pensions Service (MaPS) is one such organisation. We provide free and impartial money and pension guidance, and debt advice, including a range of digital tools designed to help people manage their money. You can embed these onto your intranet and/or website, eliminating the need for you to develop or commission your own content.
Employee engagement is key – and a holistic approach to wellbeing is most effective
In my experience, the most effective way of addressing financial wellbeing is often through embedding it into broader organisational wellbeing initiatives. Adopting a more holistic approach can be more impactful as financial, physical and mental health are intrinsically connected. This approach can also prove more effective in engaging employees, something that is often overlooked. It’s important not to assume that just because an organisation has a financial wellbeing programme that employees will automatically engage – like senior leadership, you also need the buy-in of your employees. A recent study into the financial behaviours of UK adults showed that 29 million adults don’t feel comfortable talking about money, despite 48% admitting they have regularly worried about finances6. It also showed that the long-held stereotype of avoiding money conversations because it can be perceived as impolite was not the main reason that people do not talk about their finances – in fact the most common reasons are shame, embarrassment and not wanting to burden others. Talk Money Week,(8-12 November) is a great annual platform to get your employees talking about their finances and raise awareness of financial wellbeing in the workplace.
You’ll see that there isn’t only a strong business case for having a financial wellbeing policy in place, there is also a strong moral case. The pandemic has shown that it is more important than ever for organisations to support their employees to build their financial wellbeing. However, we know the pandemic has also meant significant challenges for many organisations, resulting in financial wellbeing slipping down the ladder of priorities.
Four small steps you can take today
With that in mind, taking some of these small steps as an organisation could be a good start:
• Signpost your employees to our free, impartial and confidential money and pensions information and guidance including debt advice • Embed our guidance, tools and calculators onto your intranet and/or website and order free printed guides to distribute to your employees. • Get involved in Talk Money Week. • Contact our partnerships team or your relevant regional manager directly who can provide free and bespoke support to help you develop financial wellbeing in your workplace.
Often it’s the small things that can make the biggest difference – and embedding financial wellbeing in your workplace not only shows your employees how much you value them, but will enable them to feel secure, confident and empowered to make effective financial decisions. Invest in your greatest asset today.
1 CIPD 2021 Reward Management Survey 2 94% of UK employees admit to worrying about money and, of these, 77% say that money worries impact them at work. Close Brothers, The Financial Wellbeing Index (2019). 3 Centre for Economics and Business Research, Financial wellbeing and productivity: A study into the financial wellbeing of UK employees and its impact on productivity, 2018 4 Aegon and Centre for Economics and Business Research, Financial wellbeing and productivity: A study into the financial wellbeing of UK employees and its impact on productivity, 2018: 5 69% of UK employers. Neyber (2018), The DNA of Financial Wellbeing 2018 6 Money Secrets research conducted by Opinium for the Money and Pensions Service.
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