Start small, think big
Financial wellbeing is fast becoming a priority for employers and with recent research suggesting that 58% of UK employees have been affected by financial worries in the last year1, there’s a clear link between financial stress and the impact on your employee’s mental health.
To coincide with Word Wellbeing Week, we were asking employees to vote in our latest poll and tell us ‘If your income was to suddenly stop, how long do you believe you could continue your current lifestyle for?’
The results, although a little shocking, weren’t altogether surprising. 40% of respondents told us they could only continue their current lifestyle for one month or less should their income suddenly stop. And, 22% of voters could only continue their current lifestyle for two to three months, highlighting that more than 60% of respondents don’t have any contingency money in place. Other results included:
- 13% of people could continue their current lifestyle for six months to a year
- 13% of people also voted they could continue for more than one year; and
- 9% voted they could continue for three to six months.
So, should the unpredictable happen to one of your employees, how can you ensure they can be better financially prepared?
Educating your employees on the importance of being financially healthy can be the first step. It is recommended that a person should have three to six months’ salary in savings in case the unexpected should arise. But what if your employees don’t know this? Helping them understand that when life throws those annoying and unexpected financial events our way, it is better to be prepared and have the savings, rather than reach for the credit cards and loans.
Communicate the ‘Rainy day’ fund
Once employees understand the importance of having some savings set aside for emergencies, also known as a ‘rainy day fund’, they will be more likely to start their fund. It’s important that employers don’t send out one message and leave it at that. Making an impact will require continuous communication and reminders about how having a ‘rainy day’ fund will not only benefit employees financially, but the peace of mind it brings can have a significantly positive impact on their mental health too.
Start small, think big!
You’ve now educated your employees and are providing constant motivation to ensure they keep their rainy-day funds going. For some employees this will be enough, and they will now be well on their way to improving their financial wellbeing. However, for other employees, there is already a struggle to pay for things today and putting away an extra bit of money each month is more of a luxury. Encourage your employees to start small and think big. Small things like walking to work instead of driving, bringing in lunch a few times a week rather than buying it out every day, or not buying a coffee on the commute will all eventually lead to big savings.
The wellbeing of your employees is paramount to a successful business and with financial wellbeing playing a huge part in this, employers cannot afford to ignore it. If you feel you want to do more, or explore other financial wellbeing ideas then Secondsight can help. We can help you to implement a complete wellbeing strategy including a financial education and employee benefits programme. Contact us today to find out more.
1.The DNA of Financial Wellbeing report, Neyber