In the current environment, many people have faced difficulties in saving as much as they would ideally like. A survey of working adults by WEALTH at work found that almost half of workers (47%) say their biggest financial concern is not being able to save enough for the future, rising from 37% a year ago.

Financial strain is extending directly into the workplace. Workers admit that money worries affect their performance at work by causing increased stress levels (36%) and mental exhaustion (34%). This has implications for workplace productivity, including decreased motivation (23%), reduced focus and concentration (20%), and increased sick days (8%).

With this in mind, WEALTH at work has prepared the following tips for employers to help employees build their financial resilience.

1.) Understand the needs of employees
Employees are likely to have different financial priorities depending on their life stage. For some the priority may be saving a deposit for a first home. For others it might be saving for retirement, or paying off debts. It’s important that employees put a plan in place on how to reach their goals and they may require support to do this. It therefore helps to design a financial wellbeing programme which includes financial education to support differing requirements.

2.) Provide support on the basics
Many people struggle to understand basic financial issues and helping employees become more familiar with them is an important step. For example, employees could start by reviewing their outgoings including everything from bills and subscriptions to food shopping and socialising. Scrutinising spending can highlight areas that could be cut back on. A great example is insurance, where someone might be able to get a better quote by shopping around and using tools like comparison sites, but many neglect to do this.

3.) Promote the employee benefits package
WEALTH at work’s research found that many workers are prioritising building their financial resilience this year and 42% said they would save for future goals if they had spare cash. Employees should be encouraged to investigate the range of workplace benefits that may be available and suitable for them to help with this. Many leading workplaces offer a range of ways to help employees save, from staff discounts and workplace benefits that can reduce everyday spending, to dedicated savings vehicles such as payroll savings schemes, employee share plans, and tax-efficient savings products including ISAs. Many also provide financial education and guidance to help employees build confidence, make informed financial decisions and improve their overall financial wellbeing.

Some employers will also match any additional pensions contributions, which employees may not be aware of. For example, someone who is 25 years old and plans to retire at age 68 can increase their pension pot by 25% by saving just 1% more, if their employer was to match this. Making sure benefits are relevant and well-explained can really help take up and improve money management.

4.) Help employees understand the difference between good & bad debt
Another important principle for employees to understand is the difference between good debt and bad debt. For example, a mortgage is a form of good debt – it makes sense to have a loan in order to own your home as it is a stable, easy to manage approach to long-term borrowing. However, it should still be reviewed occasionally to ensure that it’s a good deal. At the opposite end of the spectrum, debt with high interest payments such as payday loans and credit cards can get out of control if they are not repaid quickly. Employees should realise that it should always be a priority to pay off bad debt. For example, a debt of £3,000, with a rate of 18% APR, could take 9 years and 10 months to pay off when paying £52 a month, with total interest of £3,091 paid. If that monthly payment was increased to £100 a month, the debt would be paid off in 3 years and 4 months, and interest paid would be only £908. If this was increased to £325 a month, the debt would be paid in 10 months, with total interest of £229 paid.

5.) Stress the importance of an emergency fund
A lack of savings can have a serious impact on financial resilience, as many people unfortunately realise too late the importance of having emergency savings. Ideally, employees should have three to six months of emergency savings which can be accessed at short notice. This can provide a financial buffer if they, or a member of their household, experiences a drop of income due to redundancy, illness, or unexpected expenses - such as replacing the boiler or expensive car repairs. Remember that workplace savings can help support this goal.

Jonathan Watts-Lay, Director, WEALTH at work, comments; “Financial resilience is no longer a ‘nice to have’, it's a key part of employees’ overall wellbeing. With ongoing cost of living pressures and economic uncertainty, many employees are looking for practical support to help them manage their money, build savings and plan for the future. An effective financial wellbeing strategy can help employees feel more confident and in control of their finances, both now and in the future.

Many employers are responding by offering financial education, guidance and digital support. Programmes should be tailored to different life stages and financial needs. This includes topics such as budgeting, debt management, emergency savings, investing and retirement planning. Employers are also expanding their workplace savings offering, from payroll savings and workplace ISAs to employee benefits and discount schemes, making it easier for employees to build financial resilience and improve their financial futures.”