Summary: Financial worries are impacting employees. Workplaces need to provide employees access to the tools and benefits they need to navigate this or risk retention and engagement.
A few decades ago, the financial contract between parents and children was reasonably clear. You raised them, you educated them, you launched them; and somewhere around 18 or 21, the heaviest costs were behind you. But today that contract has been rewritten.
And for employers, this matters more than most realise. The financial pressure is showing up in workplaces as a retention and engagement issue, particularly among experienced employees in their 40s and 50s, who organisations often rely on most.
New research from Octopus Money, based on a survey conducted by Opinium of 2,000 UK parents aged 45-65, highlights the scale of the shift. It found that 92 per cent are still financially supporting their adult children. One in six believes their child may never achieve full financial independence.
And 49 per cent of Gen Z and millennial adults in the UK have returned to live with their parents, driven by rising living costs. The Bank of Mum and Dad has become less of a one-off loan and more of a standing order with no end date.
Now increasingly known as the ‘sandwich generation’, many in midlife are also absorbing costs from the generation above.
Almost one-third of those surveyed are providing financial support for their own parents or parents-in-law, at a time when average nursing care costs are running to around £80,000 a year. The pressure is coming from both directions simultaneously, with no obvious relief valve.
Why it is a workplace issue
Financial stress in UK workplaces is already at crisis levels. Numbers from Zellis found that 92 per cent of UK employees are stressed about money. Over half say it reduces their productivity, and nearly half report losing sleep.
But this stress is not confined to junior workers. One in five employees aged 45-65 say financial strain is already affecting their performance at work, according to research from Octopus Money. Nearly half would consider changing jobs for better pay if it helped them manage their family financial pressures.
This creates a clear retention and productivity risk in the very cohort many organisations depend on most. Yet it remains largely unspoken: while 29 per cent of workers are concerned about being unable to afford basic living costs, only two per cent approach their employer for support.
One in five employees aged 45-65 say financial strain is already affecting their performance at work
A pay rise is not the only way to fix this
Pay plays a role in financial security, but it is not the whole story. Higher salaries can help people gain control of their finances, yet financial anxiety persists even among higher earners.
The difference is rarely income alone. It is shaped by circumstance, knowledge and access to guidance.
Employees on identical salaries can experience vastly different levels of security.
Focusing solely on pay overlooks the structural and behavioural factors that truly determine financial wellbeing.
What actually works
I have long advocated treating financial wellbeing with the same institutional seriousness as mental health.
That means it must be normalised, supported and embedded into workplace culture, not left as a private concern for employees to manage alone.
Culture is critical, too. The organisations seeing success are those where leaders openly acknowledge financial pressure and remove the stigma around talking about money.
This plays out in the evidence too. I was recently told about tax and advisory firm Blick Rothenberg, who introduced financial coaching as a staff benefit and over 65 per cent of employees engaged within the first few months.
Their CEO found himself being stopped in corridors by colleagues wanting to share what they had learned. He said: “People are talking about this in the coffee areas and in their team meetings”.
That shift from silence to conversation is a really important part of removing the stigma around money to give space to make a positive change.
Real, personalised support
Whether its employee benefit design, financial tools on offer or even just the way we communicate, all employers should be offering support that reflects real lives rather than assumed ones.
Personalised support is more effective than one-size-fits-all interventions like webinars, because it reflects the complexity and fluidity of individual circumstances.
One of the starting points I always recommend employers to do is to help them understand what they already have through clearer communication of benefits, better retirement guidance and access to impartial coaching. These are all seemingly small ways that the evidence tells us builds up employee financial confidence over time.
When employees feel more in control of their finances, the impact shows up in the workplace. Those who access financial planning through work are 76 per cent more likely to stay with their employer longer.
Increasing an employee’s money confidence reduces the time they take away from work and improves productivity too.
All employers should be offering support that reflects real lives rather than assumed ones
A heavy burden
If we look at the data, this generation is dealing with a far more complex set of financial problems than any before it, carrying more weight than previous generations had to.
If we are to build the best workplaces with the highest levels of output and performance, we can’t ignore these unique challenges.
The best workplaces are those that deal with these issues head on by providing employees access to the tools and benefits that help them navigate this increasingly complex landscape.
Actionable insights
- Make financial wellbeing a crucial pillar: If it’s invisible in your metrics, it won’t get attention.
- Provide personalised support: The one-size-fits-all approach doesn’t land. Coaching, guidance, check ins and tailored support are crucial.
- Pay attention to midlife employees: This group often gets overlooked but they may be carrying a silent burden.
- Encourage transparent discussions on financial pressure: Financial wellbeing should be part of internal comms.
- Ensure employees understand what support is available: This begins with a quick audit of whether people actually know what benefits exist.
You can read another article by this author here: Pay transparency WILL come to the UK: Are you ready?
