For many households, the start of the year is traditionally a time when concerns about financial debt are at their highest, as people recover from spending over the holidays. UK charities support that fact, reporting they didn't expect this year to be any different.

Regardless, debt builds over time and figures from the Trades Union Congress showed that the average household in the UK now owes near £13,000 — the highest figure since 2008. The Bank of England said there is no reason to be worried about high debt levels, but still described the situation as one that it will “watch carefully.”

The negative impact of debt on the public’s purse and the wider economy isn’t the only concern—its impact on health and well-being may warrant further attention. Financial health is often cited as one of five elements that contribute to an individual’s overall well-being. However, despite knowing that UK employees are concerned about their financial situation, studies on financial well-being are limited.

A survey of 34,000 UK employees that RAND Europe produced on behalf of VitalityHealth’s Britain’s Healthiest Workplace—a competition that measures the healthiest employees and work environments in the UK—revealed a number of unique perspectives on well-being and productivity. One was related to the impact of financial concerns on well-being and its link to lower productivity levels at work, either from absenteeism (employees not being at work) or presenteeism (employees being at work but working at a sub-optimal level). A quarter of those surveyed said they experience financial concerns, highlighting its impact on the well-being of the UK workforce.

Another survey of over 2,000 British employees—conducted by Barclays as part of its “Financial Well-being: The Last Taboo in the Workplace” report—shows that nearly half of UK employees are worried about their finances. With regards to their own personal or family finances, the majority of respondents (around 60 per cent) said they were “balancing,” or concentrating on immediate financial issues rather than saving for the future. This is a troubling finding, since an unexpected high outlay, potentially triggered by an unexpected life event outside of their control, could have severe financial consequences.

The link between financial concerns and workplace productivity is supported by financial start-up Neyber’s report on “The DNA of Financial Wellbeing,” which states that 17.5 million working hours are lost each year due to financial worries of UK employees. This is the result of workers struggling to concentrate and missing work because of stress and anxiety caused by financial concerns. Long-term stress and anxiety is also linked to problems with mental and physical health and well-being. A study by the University of Southampton showed that experiencing financial difficulties and worrying about debt at university increases the risk of mental health conditions, such as depression.

Concerns over money matters also affect sleep. A recent RAND Europe report showed that people with financial concerns sleep on average about 10 minutes less per day than those without similar concerns. This may seem like a small number, but over a period of a month 300 minutes of sleep are lost per person. The Barclays financial well-being report supports these findings, as it revealed that 20 per cent loses sleep worrying about finances.

Insufficient sleep is a significant aspect of poor health and well-being, leading to lower productivity levels at work and a higher mortality risk. In the UK alone, over 200,000 working days are lost due to insufficient sleep, and at any given point in time an individual who sleeps on average for less than six hours per night has a 13 per cent higher mortality risk than someone who sleeps between seven and nine hours a night.

There is a clear link between UK employees being concerned about their finances and negative health and well-being. Indeed, the Neyber report states that its findings should be a “wake-up call” for UK employers. The challenge for researchers is that financial well-being is hard to measure. Largely because how people manage their finances is an individual behaviour, varying from person to person, and not simply based on how much people earn.

With so many UK employees worried about their financial situations, a more comprehensive understanding of financial well-being is needed. More research on the subject is needed, and necessary.