10 Surprising Financial Wellbeing Facts Every Employer Should Know
So you think you’ve got your mental health strategy all worked out, and you offer a pretty sweet gym discount and private healthcare product to cover your employee’s physical bodies. Still, if you are ignoring their financial wellbeing, you can almost guarantee that their overall health and wellness is not going to be anywhere near as good as it should be.
With recent advances in technology – namely Open Banking, and the current pandemic situation highlighting the money-related pressures individuals are facing, the spotlight on financial wellbeing has never shone brighter.
We know that Financial Wellbeing should be at the core of any wellbeing strategy; here are some of the critical reasons why:
- Money is the number one cause of stress in the UK. You are 5.3x more likely to be suffering from depression and 3.7x to have anxiety problems if you have poor financial wellbeing. Worryingly, 94% of UK employees worry about their money. SO there’s a high chance your employees are struggling with some money-related stress.
- It costs business a lot of money, and it’s all down to lost productivity caused by presenteeism, absenteeism and low staff retention. Staff members bogged down by their financial woes often spend time thinking about their money, rather than concentrating on their job. In fact, 35% of workers believe that their financial concerns prevent them from performing their best whilst at work. The cost of lost productivity is enormous: 17% of your yearly payroll, equating to 70bn a year for UK business.
- A quarter of UK adults have no savings. Zero, zilch, nada Nothing to fall back on, nothing saved for a rainy day and no investments to speak of. When it comes to alleviating money stress, having an emergency fund certainly helps. Often, a lack of saving isn’t just down to having a lack of money; it frequently comes down to not knowing how to set, and stick to, a budget.
- Nearly half of UK adults in the UK don’t feel confident in making financial decisions. Particularly when it comes to choosing financial products and services which are longer-term. Also, 59% of people of working-age didn’t seek financial advice when it came to big life events like buying a house or organising a pension.
- 55% don’t feel they understand pensions. When it comes to making important decisions about their pension, UK workers say that they don’t have enough knowledge to make a sound decision for their savings for their retirement.
- Poor Financial wellbeing affects ALL income brackets. From the intern to C-suite, no employee is free from the risks associated with poor financial wellbeing. Research has found that people earning between £10k and £30k per annum have a similar level of financial worries as those earning £90k+ per annum (27% vs 24% respectively). It doesn’t vary much between how much they earn, what industry they work in or where they live – poor financial wellbeing doesn’t come down to your level of seniority or your income.
- Your employees want your help. There can be a tendency to think that employers should stay out of their employees personal finances; aside from paying their wages, there’s nothing else you can do to help – this is wrong! Research has found that 50% of employees want their employer to provide financial guidance tools.
- Higher financial literacy = higher financial wellbeing. People who have increased their financial literacy and learnt how to manage their wealth in a constructive way found that their financial wellbeing improved, often feeling less stressed by and more able to cope with their money.
- 40% are living paycheck to paycheck. A significant number of people are barely scraping by to the end of the month. Many (78%) are having to rely on expensive payday loans, advances and credit cards to see them through. In London, 91% rely on debt to see them through.
- Fewer than 1 in 5 workplaces offer financial wellbeing support. This means there are millions of people across the UK who, despite desperately needing financial wellbeing guidance, are not receiving any help.
As you can see, despite all the signs and statistics pointing to the massive importance of financial wellbeing on both individuals and their employers, many are still neglecting their employees by not providing adequate and innovative financial wellbeing support. Considering the impact poor financial wellbeing has on business, it’s not something that should be ignored any longer.
Services like Bippit which provide expert, personalised, confidential and impartial financial wellbeing tools at the touch of a button are revolutionising how your employees manage their money and grow their long-term wealth. We are here to support your teams on their path to financial freedom – get in contact today to hear more about how we can help.