Rising costs are continuing to squeeze people's pockets. But encouraging staff to speak up about their money concerns could help ease some of the pressures they face.
Indeed, Standard Life’s Retirement Voice 2022 report reveals that financial pressures are having a significant impact. Of the 6,000 people surveyed, almost half (49%) are cutting back on their everyday spending, and 58% say they worry about running out of money – despite already cutting back.
Meanwhile, just 41% feel positive about their financial situation – down from 48% in the previous year.
By normalising conversations about money concerns in the workplace and understanding the impact finances can have on mental and physical health, employers could help reduce these stresses and improve financial wellbeing as a result.
Financial worries are impacting people’s wellbeing
In May 2023, the Bank of England raised interest rates for the 12th consecutive time. As a result, many employees are likely to face heightened financial pressures on their borrowing costs. This may affect some employees' mental health.
In fact, more than a quarter (28%) of people say the rising cost of living has already had a negative effect on their mental health, according to research by asset management firm BMO.
Worryingly, research by the Money and Pensions Service reveals that 81% of UK adults avoid talking about money.
The most common reasons for avoiding talking about money are not wanting to be judged, fear of burdening others, and shame or embarrassment.
How talking about money can help
It can feel overwhelming to tackle money problems alone – especially in this climate of soaring energy bills and rocketing food prices.
Starting a conversation about money with friends, families, or colleagues can help to provide emotional relief and moral support.
Indeed, according to the Money and Pensions Service, people who talk about money feel less stressed or anxious and more in control, build their financial confidence, and make better and less risky financial decisions.
Employers can play a vital role in encouraging staff to have these conversations, helping to reduce the immediate stresses and improve long-term financial wellbeing. Here are a few ideas to get started.
How to encourage employees to talk about money
Through signposting and support, you can help raise awareness on the importance of talking about money. This could either be through a dedicated employee assistance programme or a trained in-house colleague support network. By making employees aware of the support available and making it easier to access, it helps reduce any potential barriers that may be preventing staff from seeking help.
Little things often can make a difference. Through internal communications, employers can show that they recognise the importance of this issue to their employees, and create safe spaces for people to open up about their concerns.
Create a supportive work environment
The broader workplace environment can also help. For example, it may help to have a quiet room in the office so that employees have a dedicated space to take calls or have down time, if needed. Where possible, it may also be worth considering if staff need to be in the office every working day, to help them save on travel costs.
If employees are stressed about the cost of living, then adding additional workplace stress is unlikely to help. Normalising breaks and trying to support flexible working can make a big difference.
Help employees manage their everyday spending
If people don't know how to begin managing their money, there's an increased risk of them avoiding their financial problems – which could make them worse.
You can help by pointing employees towards tools to help them budget. You could also signpost employees towards information on benefits and other support they may be entitled to – some of which employees might not have considered. Online eligibility trackers and calculators may help with this.
In it together
When it comes to financial concerns, it's essential for people to remember they’re not alone. Many others may be in the same boat or have experienced money worries in the past. Creating a workplace culture that cares about mental and financial wellbeing can help manage the pressures many of us may face – before they reach boiling point.
For more information on how to support your employees’ financial wellbeing, take a look at our financial wellbeing articles for some ideas and inspiration.
To find out how a financial wellbeing strategy can have a positive impact for employers too, read our ‘How a financial wellbeing strategy can benefit employers’ article.