While personal finances are typically a topic best avoided among coworkers, employers should be aware that their employees’ financial health can have a decided impact on their bottom line.
The majority of Americans are stressed about their finances, but it can be difficult, if not impossible, for employees to leave their money worries at home when they come into work for the day. According to United Benefit Advisors, personal financial stress affects nearly 25 percent of employees while they’re at work.
How Employee Financial Health Affects Employers
Does it really impact a business if employees are experiencing money problems in their personal lives? In short, yes.
Employees who are struggling with their own finances are likely to struggle at work when compared to their non-stressed counterparts.
Over time, an employee’s financial stress can lead to:
- Lower productivity – Employees who are distracted by thoughts or worries about their financial situations are less focused when they’re at work.
- Higher absentee rates – Financial stress is often caused by a lack of savings, which makes it harder for employees to cover unexpected expenses, such as car repairs or child care when a friend or family member cannot babysit. These situations may prevent employees from coming to work.
- Increased healthcare costs – Stress can affect employees both mentally and physically, leading to conditions like obesity and migraines. Not only that, but employees who are struggling with their finances might put off going to the doctor and receiving preventative care, leaving them vulnerable to more serious (and costly) health conditions in the long-term.
What Employers Can Do to Help
When business leaders and HR professionals help employees improve their financial health, everybody benefits.
The most effective way to help staff reduce their personal financial stress is to provide easy access to resources that can teach employees how to make a sustained behavioral change. One such resource is an Employee Assistance Program (EAP) that can work with employees to improve their budgeting skills, address debt, and reduce personal financial strains.
Hosting lunch and learns, workshops, and other training sessions that touch on the financial concerns most relevant to your employees can also help reduce stress. Relevant workshops may address topics such as saving for retirement, establishing emergency funds, or paying off student loans. These companywide events can help decrease the negative stigma associated with financial troubles, ultimately making it easier for your employees to seek help.
If you’re interested in establishing an EAP at your workplace to assist with financial issues, call Mazzitti & Sullivan EAP Services.