This week is World Well-being Week, a movement which promotes time to reflect on, and encourage, well-being in every aspect of our lives.
You may be thinking that, since the pandemic, well-being has rarely been far from the headlines, especially in relation to mental health. We, though, wanted to focus on another aspect of well-being: financial well-being. That is the feeling of being in control and comfortable with your finances.
What does financial well-being have to do with employers?
The financial well-being of staff can actually have a big effect on you and your business. With the recent inflation shock and cost of living crisis it sparked, it is no surprise that in one 2023 workplace health report, financial pressure came out as the number one cause of stress outside of work, with 37% of respondents describing feeling it.
This can impact performance, culture and retention for you. For example, if staff are of the mindset that moving jobs for a couple of extra grand may solve some of their problems.
Some warning signs that people are struggling with financial well-being may include changes in behaviour or performance (although this could be attributable to many other causes too), a request for a short-term loan until pay day, or signs of them going without staples like: not eating enough during the day, not being appropriately turned out, or not using their usual mode of transport – say a car is broken down and they can’t afford to repair it.
How can you encourage financial well-being amongst your staff?
As much as everyone would love it, financial well-being does not mean handing out pay rises like confetti. There are much more basic (and cheaper) actions which you can take, which are more achievable for SMEs facing cost pressures from every direction.
“Education, education, education” was a memorable political mantra, and it certainly applies to financial well-being. Strangely, if you think about it, we are not taught about basic financial management and planning at school. So we each have to work it out for ourselves and some never properly do.
As employer, you may see the business case in stepping in. You could strike up a partnership with a local IFA who will come in and do an occasional talk about financial planning to your staff, with the view to picking up a few new clients. They may be able to get you a superior deal on your company pension and offer the talks as part of that service.
Separate to this there are financial coaching services which you can sign up to as part of an employee benefits package. In fact, over on our podcast we have just had a conversation with such a service called FinWell. It is an interesting listen alongside this blog.
There are a number of low cost, cost neutral, or even cost positive other steps you can take.
- Consider using salary sacrifice schemes whenever possible for things like pension contributions and Cycle to Work Schemes. By making contributions before salary is paid the employee gets an income and national insurance tax saving, and you save on employer national insurance. With many tax thresholds frozen for the foreseeable future, this will be more valuable than ever.
- Inform staff that under certain circumstances they may be able to claim a small tax deduction as a working from home allowance if, of course, they do work from home. It will be free money to them, if they can claim it via a tax return.
- Encourage auto enrolment sign up – tell them about the benefits and how the employer contribution that will boost their own pension contributions, as well as the benefits of starting early with long-term savings.
- Consider an employee assistance plan (EAP). They are low cost employee benefits which may provide 24/7 telephone GP access, counselling lines which include debt advice and other perks.
More well-being ideas
Whether it is financial well-being or some other solution for helping get your employees feeling positive and motivated, we are your HR experts who will come up with a pragmatic, effective solution. Get in touch today to find out more.
