This Debt Awareness Week (24th – 30th March), WEALTH at work – a leading financial wellbeing, retirement and workplace savings specialist, are encouraging employers to support employees to tackle money issues and build a saving safety net.
Almost a quarter of UK workers (23%) have had to borrow money from family and friends in the last year because of money worries, and almost a fifth have taken on debt (18%) – according to new research of over 2,000 workers by WEALTH at work. Over a quarter (28%) have worked more overtime, and more than one in ten workers (13%) have taken on an additional job.
Workers thought that their biggest financial concerns for the year included not having enough savings for unexpected costs (42%), not being able to save enough for the future (37%), not being able to pay basic living costs such as rent, mortgage payments, energy bills, food etc. (34%) and being in debt (29%).
The weight of this financial burden and debt anxiety has spilt into the workplace. Workers admit that money worries affect their performance at work by causing increased stress levels (40%), mental exhaustion (35%), decreased motivation (26%) and physical exhaustion (25%). More than a fifth (22%) admitted that it led to reduced focus and concentration, and one in ten (10%) say it has led to increased sick days.
Whilst 61% of workers say they feel supported and 40% say they are comfortable discussing money worries or debt-related issues with their employer, only 13% would actually do so. Those age 55+ are the age group least likely to seek help from their employer, with only 5% saying they would.
Despite these findings, there is a positive future outlook with 43% of workers believing their financial situation will improve. Also encouragingly, the research found that if they had spare cash, more workers would save it for a rainy day i.e. such as in an ISA (42%), pay off debt (35%), spend on essential bills (34%) or save it for retirement (26%), rather than spending it on something they want (25%).
Jonathan Watts-Lay, WEALTH at work, comments, “It seems financial worries have become the new normal. With almost 14.6 million UK adults not coping financially or finding it difficult to cope, many are looking for ways to help ease the strain on their finances.”
He explains; “Whilst being employed has traditionally been associated with financial stability, research from StepChange showed that 44% of those seeking debt advice were full-time employed, cementing that money worries are firmly also a workplace problem. Afterall, when struggling with money, people are less productive when they are in work, can be tipped into financial vulnerability and at a greater risk of predatory behaviour from scammers.”
Watts-Lay adds; “It’s interesting that the research found workers would rather save spare cash for a rainy day than spend it on something they want. After all, having a savings safety net to fall back on is a crucial part to overcome money worries. In fact, research finds that overall those with savings are generally less anxious about money and have greater life satisfaction. This is because savings can help improve financial resilience by removing the need to borrow, as well as preventing hardship by having access to funds to draw on when needed.”
He continues; “These findings should prompt employers to consider how employees are being supported to tackle money issues head on and build financial resilience. Many employers overcome this financial wellbeing risk by providing financial education and guidance, as well as providing access to workplace savings such as ISAs. This support can make a huge difference by giving workers the opportunity to understand their finances, including ways to save money, learn about budgeting, manage debt, and how to boost savings and prepare for retirement.”
He continues, “So don’t bury your head in the sand, there is support available and it’s always worth speaking to your employer to see how they can help. This all makes for a brighter future for all.”