Your employees are one of your greatest assets.
They’re your knowledge base, your customer support, and the people who make all the gears turn smoothly. Every day, they invest their time, energy, and ideas in the future success of your business.
In other words, they’re the key to growing your business.
The trouble is most of your employees aren’t able to give you their best work. They’re often unhappy, distracted, and on the lookout for better job opportunities.
Not because they want to cause trouble. And not because of a bad attitude. They’re simply overstressed by money matters.
Today, financial stress is the No. 1 challenge for all age groups of workers.
Regardless of their age or income level, employees are struggling to make ends meet, pay down debt, and plan for the future. And the stress this causes is enough to keep them from giving you their best effort, even if they want to.
As you can see, there’s an unusual connection between your employees’ financial wellness and your ability to grow your business. So it pays to understand the financial stress your employees are dealing with and how you can help.
Financial stress: The No. 1 cause of employee churn
Studies in a range of disciplines are uncovering a startling fact. One stressor impacts everyone in the workplace: personal finances.
Though financial stress may be a personal challenge, it directly impacts businesses by lowering employee productivity and increasing costs.
- It can reduce productivity by as much as 20 hours per month.
- It can raise healthcare costs from stress-related injuries and illnesses.
- Not to mention, it can increase turnover from employees looking for better opportunities.
That puts employers in a cycle of replacing and training new employees instead of focusing on what matters most: growing their businesses.
Clearly, financial stress if a lose-lose for everyone …
Or is it?
If growing your business comes down to helping your employees feel more in control of their finances, three simple responses from you can create a big win for everyone.
1. Take time to explain your employees’ paystubs
Whether they’ll admit it or not, most workers find their paystub hard to read, according to a 2017 Kronos survey.
- 42 percent of employees say taxes and deductions on their paycheck are confusing to read and understand.
- 45 percent of employees would feel more engaged with their job if their employer helped them better understand the impact of taxes and deductions on their overall earnings.
And it’s an easy fix. All you have to do is take time to explain paystubs to your employees, so they understand why money is being taken out and where it goes. You can do this one-on-one, in group sessions, or as part of new employee orientation. This infographic can help you present the information. (There’s a Canadian version, too, available here.)
By helping employees understand what all the numbers mean, you can build trust and ensure they know how much take-home pay they have to work with.
2. Arrange office time with a financial advisor
Another smart move is to invite a financial advisor to be on call for your employees one or more days throughout the year.
Most people aren’t confident in their financial skills, which is why they’re stressed in the first place. They often need help with basic financial decisions, such as setting a realistic budget, saving for their kids’ education or their retirement, or creating a plan to manage mounting debt.
Hiring an advisor for a day may seem expensive, but it’s important to consider the cost of doing nothing. A study by the American Psychological Association (APA) found 72 percent of adults feel stressed about money at least some of the time. One in 5 says they’ve experienced extreme financial stress. Most are probably struggling with it in one form or another right now.
This is where financial stress hits you the hardest.
Sure, your employees are on the job, but they’re preoccupied with their financial issues. They’re on the phone trying to resolve their problems, on the computer researching solutions, or simply thinking about what their options are. The result is presenteeism, low morale, and lower productivity.
To tackle this problem head-on, give employees access to a financial advisor. According to a study by Lockton, getting professional help can make a big difference in employee stress levels.
When’s a good time to bring someone in? Anytime would be helpful, but finances become especially burdensome before the holidays and during tax season.
If you have a physical workspace, consider setting up a conference room for one-on-ones with a financial advisor. If you run a virtual office, a video conference could be set up just as easily. Then allow your employees to sign up on a first-come-first-served basis.
3. Provide free financial training
Face-to-face time with an advisor isn’t your only option. A 2017 survey on corporate health and well-being has found that seminars and “lunch-n-learn” programs can also help employees feel more confident about their finances. And it’s becoming a go-to solution for many businesses. The corporate health survey also found:
- 82 percent of employers were planning to offer these types of programs.
- 74 percent will offer tools for employees to access income protection and manage their mortgages and wills.
- 71 percent expect to offer resources to help employees with emergency savings, debt management, and budgeting.
What’s the best way to provide financial training?
You could invite guest speakers to touch on topics you know your employees struggle with, such as budgeting, debt management, boosting or fixing their credit score, or insurance and retirement planning.
You could have knowledgeable team members present mini-courses in their areas of expertise.
Of course, you could also let your employees participate in self-directed programs that cover the most common financial struggles. Two options that stand out are both online programs that can be presented as an entire financial wellness program.
My Financial Academy offers a series of short online courses on a range of financial topics. It also provides course certificates and reporting, so you know whether it’s giving your employees the benefits they need.
Dave Ramsey’s SmartDollar Financial Wellness Solution includes entertaining and motivating video content and a step-by-step, proven plan that can lead to quick wins for your employees.
Small steps make a big difference
How do you keep your workers happy and engaged?
Most employers focus on pay raises, job titles, and workplace fun. But keeping employees long-term may be as easy as offering financial wellness benefits — everything from explaining their paystubs to helping them get out of debt and improve their credit rating.
The key is to acknowledge that financial stress is real and address it head-on. Even small steps in that direction can communicate that you understand and have got their backs.
Of course, you’ll see the benefits right away.
Lower financial stress means your employees will be more engaged and happier. And that’s going to put their focus where it belongs — on helping you grow your business.
Kathryn Aragon is an award-winning content strategist, copywriter, and author. As Wagepoint’s Content Manager, she’s dedicated to sharing helpful strategies that simplify payroll and business management. In her spare time, you’ll find her exploring her random and ever-changing interests, from bird-watching to weed-pulling to gourmet cooking and more.