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The Hidden Dangers of Financial Stress on Your Employees

The Hidden Dangers of Financial Stress on Your Employees

As an HR manager, business owner, or financial decision-maker, you probably avoid prying into employees’ personal lives. However, financial stress can consume your employees’ energy, making them less productive at work. That can lead to health problems, sick days, and other problems that affect your business.

How can you turn this losing proposition into a win-win? Financial coaching can help bring peace of mind back to your employees by giving them tools to help them with major financial life changes. As a result, you will develop a stronger, healthier work environment for everyone and boost employee morale.

Recognizing the impact of financial stress and providing solutions to help with it is imperative for today’s employers. FinFit has solutions that can help, including expert advice on:

  •   New baby/child
  •   Getting married/divorced
  •   Buying a home
  •   Understanding credit reports
  •   Budgeting guidance
  •   Unemployment
  •   Affording college and student debt

Explore these important programs and make them available to your employees! Recognizing the impact of financial stress and providing solutions to help with it is imperative for today’s employers.

What Are the Causes of Financial Stress for Today’s Employees?

Everyone has felt the effect of rising interest rates and costs. Necessities such as food, gas, and utilities now take up a bigger chunk of employees’ paychecks. This can translate to stress and strain that bleeds over into the workplace. Here are some of the biggest stressors:

  •   Credit Card Debt
  •   Lack of Emergency Funds
  •   Rising Inflation
  •   Lack of a Monthly Budget

Fortunately, FinFit has educational programs to help participants make the right decisions for their financial future. Although managers and decision-makers may balk at spending money on these programs, you have to weigh it against the savings time and lost productivity.

Increasing Credit Card Debt

Americans feel the weight of rising personal debt, which now tops $841 billion. Many families are carrying approximately $7,000 in debt. This can quickly eat up available funds if left unaddressed. Rising utility, grocery, and gas bills are forcing more families to use credit cards for day-to-day living. Consequently, total debt is on the rise.

Fortunately, there are many strategies that can help employees understand the relationship between debt and their credit score. By implementing some of the programs mentioned below and partnering with FinFit, you can take some of the burden off the shoulders of your employees by giving them the right tools for this stage of their lives.

Lack of Emergency Funds

Keeping money back for emergencies can reduce financial stress. Typically, the strategy works best when the funds are kept in a separate savings or checking account. Emergency funds help families stay afloat when appliances or automobiles break down or someone cannot work due to illness or injury.

With three to six months’ worth of expenses in the bank, employees are likely to feel much more confident in their financial health. By contrast, fewer than half of Americans can cover unplanned expenses exceeding $1,000. Help your employees understand the importance of having a cushion to fall back on in case of unexpected financial responsibilities.

Rising Inflation

The U.S. Bureau of Labor Statistics reports that the consumer price index (CPI), which measures consumer spending on goods and services, rose 9% in 2021. That includes the impact of a 35% hike in energy costs and a 48% increase in gasoline prices. Some families may face the difficult choice of paying for transportation versus paying for food.

Lack of food security and an affordable way of getting to work puts tremendous pressure on employees. Diminishing discretionary funds may mean that parents cannot provide toys, electronics, and other items to their children. This has certainly added to the emotional and mental health struggles many people experienced during the pandemic and continue to experience today.

Lack of Monthly Budget

Having a monthly budget can help your employees adjust to the reality of higher prices. You can use this and other FinFit programs to boost morale and employee retention.

What Are the Symptoms of Financial Stress?

Approximately two in five U.S. consumers had difficulty covering expenses in the past year. For those interested in gauging the impact of this stress, here are the symptoms:

  • Headaches
  • Depression
  • Weakened immune system
  • Heartburn
  • Infertility
  • High blood pressure
  • Extreme fatigue
  • Panic attacks
  • Upset stomach
  • Insomnia

If you or your employees experience difficulty sleeping, feelings of anger, muscle pain, and relationship difficulties, it may indicate a focus on financial stress.

What Are the Effects of Financial Stress on the Workplace?

Financial stress has a direct impact on the workplace since employees often cannot draw a line between their home and work lives. These effects may include becoming dangerously distracted, having outbursts, making errors, and neglecting responsibilities.

By providing your employees with the tools they need to stay calm and overcome financial hurdles, you could help them stay focused on their work and remain loyal to the company.

Well-Being of Employees Has a Direct Effect on the Workplace

By investing in the well-being of your employees, you can develop a workforce with enhanced resilience, reduced absenteeism, and higher productivity. It can also assist with retention efforts since employees will appreciate a company that looks after their health and welfare.

Stressed Employees Facing Financial Anxiety Are Less Productive

Stress in the workplace creates significant challenges for managers and business owners. Stressed employees may take more days off to deal with financial responsibilities, such as unpaid bills. If you notice a recent drop in productivity, it may be time to have a heart-to-heart with an individual employee. By finding out what’s going on, you can match them to the appropriate FinFit program so they can learn money management techniques and immediately enact them in their daily lives. Alternatively, you can include referrals to local resources for assistance with utility bills and other soaring expenses.

Physical Symptoms of Money Stress Can Lead to Missed Days of Work

Since the COVID-19 outbreak, studies have shown that nearly half of employees now struggle with mental health issues. Financial instability just exacerbates weakened mental health. Financial stress, poor mental health, and physical illness cause employees’ productivity to decline, which significantly impacts your business.

How Can Employers Help Employees Manage Their Financial Health and the Stressors that Impact Their Performance?

Conscientious employers can employ a number of techniques to take financial stress off of their employees. Consider implementing one of the following strategies to help employees sail through rough patches in their financial lives:

  •   Early wage access
  •   Pay student loans
  •   Help with the cost of aging parent care
  •   Provide financial coaching

If you need help setting up any of these programs, turn to your FinFit financial consultant for suggestions.

Offer Credit Counseling to Your Employees

Credit counseling gives employees more control over their finances. They can set up manageable payments for existing debt and learn strategies for avoiding new debt. Most credit counseling services also include training on how to read a credit report and addressing any entries that are not correct.

In some cases, credit counseling can help people avoid foreclosures and bankruptcy. These programs can give your employees peace of mind and serve as a valuable tool to boost morale, retention, and performance.

Practical Steps to Calm Stress

There are a number of steps that employees can take to keep their stress at a minimum. Deep breathing, visualization, and grounding are just a few ways that employees can remain calm when facing financial pressures.

Here are a few exercises to recommend, especially to those who need help dealing with strains and responsibilities:

  •   Box breathing involves mentally visualizing a square and breathing into it. Participants hold their breath for four counts in and four counts out. Employees can physically move along an imaginary square by walking or standing still and using visualization techniques. Continuing this deep breathing for a minute or longer can help reduce stress before tackling an important assignment.
  •   Rainbow Walk: This is a grounding method. For those who suffer panic attacks, this grounding method can bring peace and relief. As anxiety builds, take a minute to walk around the building. Look for objects in the colors of a rainbow:

o   Red

o   Orange

o   Yellow

o   Green

o   Blue

o   Indigo

o   Violet

By focusing on this task, taking pictures of objects, and mentally categorizing them, you can regain your calm and resume your work tasks.

  •   Wellness activities at work: Many employers encourage wellness activities in the workplace. You can inspire leaders and teams to take a few minutes each afternoon to breathe, perform light stretches, and otherwise take out a moment to recognize the importance of health and wellness.

Other suggestions include to ease the strain of personal finances include:

o   Lunchtime yoga class for mental and physical health

o   Healthy snacks in the breakroom

o   Create a quiet area for rest, relaxation, or meditation

o   Pay for or supplement funds for a gym membership

How Can FinFit Help with Financial Worries?

FinFit offers numerous programs that help your team members deal effectively with financial worry to avoid mental and physical health issues. Feel free to meet with one of our financial consultants to learn more about the programs below:

  • Spending and Savings Accounts: Offer your employees spending and savings accounts that help them improve money management. These bank accounts can provide a cushion and help employees avoid turning to a credit card company.
  • Early Wage Access: Providing access to wages ahead of time shows your faith in your employees and gives them opportunities to avoid financial problems.
  • Credit Solutions & Loans: FinFit can help you or your employees regain control of your finances by setting a loan program to offer employees a low-interest way to meet sudden expenses,
  • Student Loan Repayment: Help your employees find consolidation loans or refinancing programs for their financial situation.
  • Financial Assessment: Give employees a personal assessment to help them understand where they are and better plan for financial goals.
  • Financial Coaching: Employees who are recently divorced, worried about job loss, growing their family, or facing their first mortgage payments will all benefit from professional financial coaching for financial issues. FinFit offers financial advisors to coach your staff.
  • Educational Resources: FinFit has numerous resources for employees facing a new source of stress, such as:
    • Improving Credit Scores
    • Buying a Home
    • Investing
    • Paying for College
    • Caring for a Family Member
    • Preparing for Retirement
  • Life Insurance: Give employees access to affordable life insurance coverage.

Make Your Employees Happy and Reduce Financial Challenges by Offering FinFit

Request a demo of how FinFit can assist you and your employees with overcoming the stress of unexpected expenses. This is a win-win for your entire team and for your company as a whole. You’ll also have a healthier staff since financial stress can lead to heart disease and other healthcare concerns.

Let’s discuss how FinFit can help! Give the financial professionals a call at 888-928-7248 or complete the online contact form and we’ll be in touch!