Why it’s important to talk about money at work.
The UK faces some acute challenges when it comes to personal financial wellbeing.
According to the Money Advice Service, more than 8.3million people in the UK are over-indebted and 22% have less than £100 in savings. Financial anxiety ranks as the number one stressor for Brits, and that stress spills over into every aspect of life – including our performance and productivity at work.
British etiquette is so firmly ingrained into society that we just don’t talk about money!
Recent research from University College London found that people are seven times more likely to tell a stranger how many sexual partners they’ve had than they are to have a chat about their income. Employers are in an unrivalled position to help and desperately need to break the taboo by encouraging people to talk about finances.
Here are three things I’ve seen happening amongst big employers recently that can be applied in any work environment:
1. Encourage employees to set goals
We have all sorts of metrics for measuring our physical health, but one of the problems that exists with finances is that most of us don’t know what we should be aiming for!
Providing employees with guidance on setting goals that are relevant and meaningful to their age and stage in life is a really helpful start point. Once they have set those goals, they can put in place a concrete plan to achieve them.
2. Provide relevant solutions
Don’t be afraid to ask employees what they need to help them improve their financial wellbeing. Financial advice, debt counselling, affordable loans and tax-efficient saving vehicles are all well-established employee benefits.
Make sure that you are offering the solutions your employees want and need and that they understand how they fit into their overall financial planning.
3. Consider salary transparency
One employment issue gaining more and more discussion is salary transparency. The gender pay gap and public sector pay rows have brought the issue to light in the media, both Germany and Canada have passed pay transparency laws within the last year, and the Equality Act 2010 outlawed pay secrecy in the UK so that companies could no longer forbid employees to talk about their pay.
Employees who know and understand how their salary is set and can see that they are fairly compensated alongside their colleagues are more likely to be engaged and perform better. It also follows that having a level of transparency about what you pay employees puts you in a stronger position to discuss money management and financial planning issues.
The old adage goes that ‘a problem shared is a problem halved’. We might not be able to halve the issue of financial wellbeing overnight, but by breaking the taboo and talking more openly about it in the work environment we will surely be taking a step in the right direction.
Matt Frost, Business Development Director