If you feel your employees are lacking in financial literacy, you aren’t alone. A 2019 study found that only 38% of UAE employees considered themselves financially literate. Whether due to lack of education, the stigma attached to talking about money or pure overwhelm, people of all ages all around the world are chronically stressed about finances.
Financial stress can account for lost time at work to the tune of as much as 3 hours per week per employee. The cost adds up even more when you account for the health impacts of stress which can lead to higher health care costs and more absenteeism. Financial stress also affects recruitment and retention—employees become very money focused and more likely to seek out companies that can offer higher salaries and better benefits.
It might seem inevitable that people will stress over finances. Maybe even expected. But it doesn’t have to be. Nor does it have to cost your company a ton of money to solve the problem. In fact, simple educational initiatives can lower and even eliminate stress for your employees.
Here are 7 steps you can take to increase financial literacy among your employees.
1. Survey your employees to find out their financial concerns.
Chances are, you have a diverse workforce consisting of employees of all ages. It isn’t safe to assume anything about their financial concerns. You might think they’re mostly worried about retirement. But find out that they’re more concerned with saving for a house. It’s best to get a clear picture of what they’re looking for straight from their own words.
2. Customise any financial guidance.
Again, if you have millennials in your workplace, they may be more concerned about buying property or building a family. In contrast, your GenX employees are likely thinking seriously about their impending retirement. It’s important to tailor any financial literacy programs to the specific needs of your employees.
3. Provide education about existing benefits.
Chances are good that your employees aren’t taking full advantage of the benefits you’re already providing them. Once a year, consider communicating their benefits. You may also bring in a representative from your health insurance to give them an update of their benefits. How they can make the most of the resources you’re providing. If you provide a retirement or pension plan, teach them about the advantages and limitations of that plan and how they can participate in ensuring their own retirement.
4. Offer financial assessments.
Many people suffer their own financial illiteracy simply due to overwhelm. If they are battling debt and poor money management, they may be fearful of looking too far into their financial situation. However, the solution to fear is usually knowledge. Giving them a free assessment of their current financial situation and their future options will empower them to focus on goals rather than their perceived financial failings.
5. Provide access to money coaches.
This may even be one of those underused resources that you’re already providing. They may be part of your Employee Assistance Programme (EAP) or stand-alone coaches. Give employees access to online or over-the-phone financial counselling so that they can get help specific to their individual needs. Teach them to take personal control over their financial situation. Empower them and stop them floundering in financial frustration.
7. Create a culture of support.
This includes everything from offering free services to regularly communicating with employees about finances in order to remove the stigma of discussing money. Employees who feel comfortable talking about finances are more likely to improve their financial literacy and reduce their stress.
8. Bonus tip: Participate in events such as Pension Awareness Day.
There are events and awareness days scattered throughout the year that offer free resources for educating your employees. This coming Wednesday is Pension Awareness Day (UK). You can introduce your employees to some of the free talks and articles on the associated website. Help them recognise their own roles in their future retirement.
There are many ways companies can participate in raising the financial literacy of their employees. When financial stress in the workplace is reduced, everyone benefits. Employees are happier and healthier and so is your company’s bottom line.
Support your employees’ financial literacy. Help them manage today and plan for the future while continuing the growth of your company. Learn how by contacting us today.