Financial wellbeing policies: Getting to maturity in 2022by
Maturity in financial wellbeing policies comes from two areas: alignment with the areas critical to supporting financial health and employee comms that ensure broad uptake and effective adoption of tools.
More and more employers are focusing on financial wellbeing. Over nine in 10 (93%) of those responding in a recent report on financial wellbeing said that they had a financial wellbeing policy in place.
But as with all areas of wellbeing, the devil is in the detail and it’s important that policies are mature if they are to deliver on their goal of improving financial wellbeing among diverse workforces – otherwise, your investment will be underutilised.
With that in mind, what do you need to think about when it comes to improving the maturity of your financial wellbeing policy?
Poor work environments affect mental wellbeing which can affect the ability to make financial decisions
1. Understand how your organisation reduces financial wellbeing
Mature financial wellbeing strategies are organisation-wide – everything the organisation does from an employee perspective should be evaluated to assess the impact on financial wellbeing. Action is needed where this impact is found to be negative.
For example, does your expense policy require people to wait six weeks to be paid back? The impact on cash flow, particularly for low earners, can be considerable. Or is your flexible working policy too rigid, for example forcing people to take peak time public transport?
Mature wellbeing policies are never viewed in isolation, but are fundamentally linked to the way the organisation does business – this reflects the fact that all the pillars of wellbeing are interlinked. Poor work environments affect mental wellbeing which can affect the ability to make financial decisions, for example.
2. Immediately focus on building savings capacity
Having savings is fundamental to financial wellbeing. Even before the pandemic – which itself decimated savings – things weren’t going well. In 2016, for example, more than 16m people across the UK had less than £100 in savings.
It’s no surprise that respondents to our survey said they wanted help with savings more than anything else. Having savings is very protective. It allows people to respond to unexpected expenses without resorting to expensive forms of credit and it also provides psychological safety which is beneficial to long-term mental health.
Our latest financial wellbeing research also highlights how destructive not having savings has been – with considerable impact on life quality when people are forced to dip into savings to make ends meet in response to rising costs.
3. Increase the depth and breadth of your comms programmes
Picking what you’ll do to improve employee wellbeing is half the battle – rolling it out effectively is the other half. In fact, ‘rolling it out’ is a misnomer, because sustained, constant comms are how you win at increasing adoption in all four corners of your workforce.
If you’re going to use email, it must be part of a broader mix and it must have a separate strategy for different cohorts
Diversity should be your guiding principle – diversity of channels, of messaging, of when you send out material. Money champions, embedded within different cohorts and departments, are very useful in delivering ongoing engagement outside of the traditional top-down approach to comms.
Here’s one tip: email is scalable, but it takes a lot to be effective. Firstly, employees in the field may not check it regularly or even have access, while part-time employees are likely to view their emails at different times to larger cohorts and therefore miss opportunities to discuss the email content with colleagues. If you’re going to use email, it must be part of a broader mix and it must have a separate strategy for different cohorts.
Interested in this topic? Read Financial wellbeing: Why the gap between desire and success?
Jamie Lawrence is Insights Director at Wagestream, a financial wellbeing app that makes money less stressful for people in work. Founded by a group of leading financial charities, Wagestream's mission is driven by their social charter: everything they build must improve financial wellbeing. Jamie was previously Managing Editor of HRZone,...