Employers are becoming increasingly aware of the need to support employees who are struggling with their mental health, but very few understand the link between poor mental health and financial issues.

Unsurprisingly, worrying about ongoing financial issues also perpetuates poor mental health. In my 25 years as an accountant and a financial planner, I found that money was often hard for people to talk about, particularly when you are the sole provider in the household.

There can be a sense of failure if you are struggling to provide for others, and often people stop opening their post as they want to avoid the growing situation.

What is financial wellbeing?

The Money and Pensions Service defines financial wellbeing as “feeling secure and in control of your finances, both now and in the future. It’s knowing that you can pay the bills today, can deal with the unexpected, and are on track for a healthy financial future”.

This can be a tough one to tick the box on, given the rising costs and other business volatilities that surround us. It can also be made more tricky when you consider that everyone has a different life experience and expectation when it comes to money.

Approximately one in five people with a mental health challenge will also have a problem with debt.

During my years as a financial planner, I was often asked “how much is enough?” when it comes to retirement.

The answer is different for all of us and depends upon your debt, your aspirations, your spending habits and what good looks like for you, to name but a few of the variables.

While the outcome is different for everyone, the solution starts from the same place – understanding where you are right now. The issue during times of uncertainty is that acknowledging where you are now can feel overwhelming.

Not understanding where you are now, however, can lead to increased anxiety around money and all of the associated stress issues.

Why is financial wellbeing important for organisations?

CIPD research found that over a quarter of employees say money worries affect their ability to do their job and 65% of employees consider it important that a future employer has a policy in place to support their financial wellbeing.

Approximately one in five people with a mental health challenge will also have a problem with debt. On the flip side, almost half of people with a debt issue will also have a mental health challenge – which stands to reason, since debt can cause stress and anxiety, among other things.

Do you have a financial wellbeing strategy?

In our roundtable research, financial wellbeing is currently the least supported area of wellbeing, despite the correlation to wellbeing being so high.

Team leaders and managers have a part to play in the support of the wellbeing of their people, and this includes financial wellbeing.

Organisations should consider adding money worries to staff surveys and asking what support would be helpful. Items could include:

• Financial advice
• General education on finances and budgeting
• Approaching debt and money management
• Life stage planning for retirement, getting your first home etc.
• How to get a mortgage

Follow through with a strategy that supports where it is needed. Not all worries are around debt – retirement can also cause stress and confusion, as can other life events such as having children or becoming a single parent.

Education and support in these areas can give greater clarity to the employee around their decision-making and more certainty for management around staffing.

Practical action

Team leaders and managers have a part to play in the support of the wellbeing of their people, and this includes financial wellbeing. Here are some practical ways you can help and signpost solutions:

1. Signpost local free money advice

Promote financial wellbeing sites such as the government site Money and Pension Service. Include it in team briefings, noticeboards and communications. Do you have an employee assistance programme? Promote it!

2. Check your internal policies

Do your safeguarding policies include financial abuse?

3. Consider reasonable adjustments and flexibility

Maybe working from home for a few days a week would allow a partner to work more hours so an employee is home when the children finish school? Do your teams know how you can help? Is this help being applied, or are some managers not allowing the flexibility that has been agreed?

4. Partner with an Independent Financial Advisor

Offer financial clinics to discuss the company’s insurance offerings, such as the private medical insurance, critical illness cover and the pension scheme. Education can help to alleviate issues by creating a plan. Whether it’s getting a debt counselor to explain how to check your credit rating and how to improve it, or a mortgage adviser on how to get a mortgage or switch rates.

5. Adopt the Money Guidance Competency Framework

Review any money guidance your team provides, ensuring that it doesn’t stray into providing financial advice. Utilise the Money Guiders Programme and identify any areas for development and outsourcing.

6. Have a money budgeting app month or a money saving month

Research money trackers such as Money Planner: Budget Planner, which is a free app, and share what you learn. Research ways to save on household bills and share the ideas. Encourage others to do the same; if you have Wellbeing Champions within the organisation to support this idea, that’s even better.

7. Organise a charity clothes swap or a children’s clothes swap

Lots of families are struggling, but by encouraging a swap of unwanted items and making it a social event people have the opportunity to find something lovely while having a chat. For larger firms or local communities, this is a great way to help families to provide for expensive prom dresses. You could even encourage a small donation for the charity, and cake always goes down well too.

While it’s not an employer’s role to sort out their workers financial position, there are some simple actions which can help to relieve pressure, create community and improve performance.
In the fight for talent, your approach to all aspects of wellbeing could be the difference between struggling to fill vacancies and being a preferred employer.

If you enjoyed this article, read: Financial wellbeing: Examining the ‘on-the-fence’ cohort.

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