Why a successful organisation needs financially resilient employees
The past few months have given businesses and their employees a once in a lifetime opportunity to reflect on what is important to them.
Social media is full of us investing in new skills – baking, dancing and getting fitter, unsurprisingly there is not a great deal of content about improving our finances.
Whilst I welcome the flexibility shown by my banks, credit card providers and insurance companies regarding payments, this can’t last forever for the UK economy to bounce back.
If you google resilience the first result is “the capacity to recover quickly from difficulties; toughness”.
In fact, as I write this, it is currently mental health awareness week in the UK and understandably a lot of conversations are focused on supporting employees to be more emotionally resilient in these testing times. No one would deny how important this is, but I wonder how much of the stress employees are currently experiencing is to do with the finances?
How does a business benefit from financial resilient employees?
I believe an employer that can develop strategies to help their employees cope with and recover quicker from a financial shock will best positioned to capitalise now as well as in the post COVID-19 economy. Inevitably, companies will be “leaner and meaner” and facing strong competition for client’s budgets and customer’s disposable income.
If an employee is more financially resilient then they will be more productive and focused at work as they won’t be distracted by money worries.
The business is also less likely suffer from absenteeism or presenteeism, again boosting productivity which also has the potential to reduce turnover – a significant cost to any business regardless of size or industry.
Finally, positive and focused employees will be great advocates for your organisation, meaning they are more likely to engage and convert more clients.
Where can a business start?
The irony is that you may well already have benefits in place that support financial resilience.
It can be as simple as building a narrative to engage employees to better understand what is on offer, such as death in service schemes, income protection or employee assistance programmes.
In my experience, financial education can also be a great way to encourage employees to engage with their finances, especially when supported with some simple and intuitive online tools.
The area that is still massively overlooked in the workplace is saving money, especially as having an emergency fund is the bedrock of financial resilience. It’s not like we don’t have any evidence that this isn’t true, as nearly a decade on auto enrolment has proven to be a great success.
If you then think about the rather scary statistics that a third of Brits have less than £600 in savings and one in ten having no savings at all, then surely careful consideration needs to be made as to how to incorporate this into a wider plan?
So why not use this time to reflect as an organisation on how you can build and support your employees financial resilience. Afterall, the capacity to recover quickly from difficulties and toughness is going to be at the core of all successful businesses going forward.
Duncan Reeves knows everything you could possibly want to know about pensions.
He’s also got a lot of good finance knowledge that could help your employees, or even you during this difficult time.
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