Brin Chartier is director of marketing at LearnLux.
While many companies achieve the status quo with traditional benefits such as healthcare and retirement savings, financial wellbeing programs can also play a significant role in supporting employee mental health.
In this post, we will explore how financial wellbeing programs can support employees across all incomes and asset levels, and provide specific examples of how they can benefit different personas in your diverse workforce.
What is financial wellbeing?
Financial wellbeing is when an individual has the ability to meet their financial obligations, while also having the financial freedom to enjoy life. This includes being able to pay bills on time, save for the future and afford things that make life enjoyable. Financial wellbeing is an important aspect of overall wellbeing, and it can have a significant impact on the mental health of your workforce.
The money and mental health connection
For many employees, money and mental health are closely linked. Financial stress can have a significant impact on mental wellbeing, leading to various psychological and emotional problems such as anxiety, depression, and even suicide. According to a survey conducted by the American Psychological Association, 72% of Americans reported feeling stressed about money at least some of the time during the past month. Financial stress was found to be a significant source of stress for people across all age groups, genders and income levels.
Reduced productivity due to financial stress
Financial stress can cause employees to become distracted, anxious, and fatigued, which can lead to a reduction in productivity and an increase in absenteeism. Employees who are preoccupied with their financial problems may have difficulty focusing on their work, leading to lower performance and reduced productivity. Additionally, they may miss work more frequently to deal with financial issues, which can lead to further stress and a negative impact on their mental health.
Poor financial health increases the risk of mental health disorders
Financial stress has been linked to a high risk of mental health disorders, including anxiety and depression. Employees who are struggling financially may feel overwhelmed, hopeless, and isolated, leading to feelings of sadness and anxiety. Additionally, financial stress can exacerbate pre-existing mental health issues, making it more difficult for employees to manage their symptoms and function effectively in the workplace. This can lead to a vicious cycle where financial stress worsens mental health, which in turn makes it more challenging to manage work-related responsibilities.
Financial wellbeing programs support employee mental health
Financial wellbeing programs can help employees feel more secure in their finances, which can reduce stress and anxiety. They can also provide employees with the tools and resources they need to make informed financial decisions, which can lead to better financial outcomes and a greater sense of control over their financial future.
Financial wellbeing programs can benefit employees across all incomes and asset levels. For example:
- Hourly workers: For hourly workers, financial wellbeing programs can help build a strong financial foundation. This might include resources on budgeting, saving and debt management. By providing hourly employees with the tools they need to manage their variable income, they can feel more in control of their financial future and reduce stress and anxiety.
- Mid-level managers: For a mid-level manager, financial wellbeing programs can help balance competing financial priorities. This might include resources on retirement planning, investing and saving to reach their short-term goals. By providing mid-level managers with the tools they need to make informed financial decisions, they can feel more confident in their financial life today and in the future, too.
- High-income earners: For a high-income earner, financial wellbeing programs can help them make tax-advantaged decisions and plan for the future. This might include resources on retirement, tax planning, estate planning and charitable giving. By providing high-income earners with the tools they need to manage their wealth, they can make strategic decisions for their future with trusted guidance on their side.
How employers can take action
Financial wellbeing programs can be an important tool for supporting employee mental health in the workplace. By providing employees with the tools and resources they need to manage their finances, they can feel more in control of their financial future, reduce stress and anxiety, and improve their holistic wellbeing.
Whether an employee is an hourly worker, mid-level manager or high-income earner, financial wellbeing programs can provide benefits that are relevant and valuable to them. For more information on mental health and financial wellbeing, explore the Mental Health and Money eBook from LearnLux today.