What is financial wellbeing?
“A state of emotional and physical wellbeing, produced by a set of conditions and capabilities. It includes making the most of an adequate income to enjoy a reasonable quality of life and having the skills and capabilities to manage money well.” – The CIPD (Chartered Institute for Personnel and Development
How do you improve financial wellbeing?
Money is complicated which means people are making mistakes and missing opportunities with their finances.
And it’s not just limited to lower earners or younger people.
- 70% of people eligible for Marriage Allowance aren’t claiming it.
- There is over £400m in orphaned pensions where people have lost track of their pension pots.
- Most people are unaware that if an energy supplier is late or misses an appointment, you can claim £30 compensation.
Financial education is about helping people better understand and ultimately better manage their money. As a result, financial wellbeing is improved as people are more organised, save, have less debt and have clear financial dreams and goals with plans to get there.
Role of the employer
As an employer, you are in a unique and privileged position to support your people’s relationship with money and ultimately, their financial wellbeing.
There are a few reasons for this:
- Through pay, insurance, pension and benefits, you will (usually) be providing the lion share of your people’s financial provision.
- You know an unrivaled amount about your people (age, salary, dependents etc) so are able to provide personalised support.
- Your people will probably trust you in a way that they don’t trust other organisations.
- Through absence, poor productivity and missed engagement, the direct and indirect costs of poor financial wellbeing is hugely costly.
Being sales-free, Nudge is paid for by the sponsoring employer. Being paid for helps sponsoring employers to achieve:
- Peace of mind that they have no liability that comes from facilitating product distribution.
- The broadest possible engagement (average engagement levels at Nudge at 60%-75%).
- A partner who is similarly aligned on improving financial wellbeing.
To support a range of budgets, we have a range of service offerings so get in touch to find out more.
What’s the business case?
With 29.8% of employers already providing financial wellbeing solutions and 17.3% introducing it over the next year, many thousands of employers have built the business case and are seeing the return on their investment.
- Becoming a responsible employer who helps their people manage their money better.
- Minimising the cost of poor financial wellbeing on your employees’ productivity, absence and health.
- Maximising the opportunities available from improving financial wellbeing (in engagement, cost savings, attraction and retention).
In 2017, the financial wellbeing market exploded as more employers grasped the extent of the UK’s problem and how it impacts them.
A quarter of respondents (27.5%) to our latest research (The Financial Wellness Playbook 2018) reported that levels of financial stress in their organisation were greater than 12 months ago, and seven in 10 (71.9%) said that financial stress levels had not improved in the past year.
When building the business case for financial wellbeing, you won’t be short of supporting research and statistics. What’s key is making your business case relevant to your organisation and in particular your leaders.