Posted July 12, 2021
Financial problems are among the critical issues in life that give employees stress. Research shows that employees stressed by finances struggle to focus on work, reducing their productivity. Workers say that, on average, they lose nearly 15.3 hours each week worrying about their finances. About 40% of Americans live paycheck to paycheck. If they have unexpected bills, such as a medical procedure, they aren’t sure how they will cover the expense. Here’s how employers can help employees develop financial resilience in tough times.
Provide counseling, resources
Most employees with debts want to get out from under the burden of their monthly payments. Each paycheck, they see their hard-earned salary get significantly reduced after paying their bills. Due to the pandemic, nearly 70% of Americans say their income has been negatively affected.
Employees often feel overwhelmed by finances. That’s why employees appreciate employers who provide counseling services and educational resources to help them work out a financial plan.
Offer budgeting assistance
Many employees want to live on a budget. But they struggle to stretch their paycheck to cover their families’ needs and save for future expenses. That’s why they appreciate employers who help them develop a budget. Employers can provide a list of budgeting steps or hire a finance professional to teach employees the process.
Experts recommend starting the budgeting process by monitoring monthly expenses, so employees recognize their spending habits. They can start by writing down the numbers, so it’s easier to compare the money coming in vs. the amount spent. Then they can make a list of items that can be cut, and debts that need to be paid off, based on budgeting principles. It also includes making sure to set aside money for savings, even if it’s a small amount.
Explore part-time work
Many employees work a second job to increase their monthly income. They use this additional money to pay off debts, and save for retirement and emergency expenses. People can work part time from home, at a local retail store or restaurant. Set a goal for the amount of money you want to earn, so you can estimate how long you need to work two jobs.
Lean on friends
Financial stress can lead to depression. Many employees find the burden of debt and financial responsibilities overwhelming. It’s extra tough for workers with student loan debts. About 64% of those with student loans owe more than $20,000. About 31% owe more than $50,000. For these employees, businesses can offer a student loan benefit to help them with debt payments.
Employees struggling with finances need the support of friends or family to encourage them during difficult times. These people provide emotional support and encourage workers to stick to their budgets and not give up on reaching their financial goals.