Money greatly impacts personal happiness and mental wellbeing, with more than two-thirds of workers currently feeling ashamed, angry, and depressed about their finances. Four out of 10 are living paycheck to paycheck and 76% feel anxious about their current financial situation. These staggering figures are a result of the cost-of-living crisis, new warnings that energy bills could rise again in October, as well as rising inflation which the majority (95%) of the country are concerned about.

These issues have caused a noticeably concerning increase in the 37% of workers who were anxious about their finances in nudge’s 2021 global survey. However, the report also found that employees who have financial education benefits suffer less from the money worries that so many of those we surveyed experience, being 20% more likely to experience hope and contentment with their finances and 24% more likely to feel connected to their employer. 

Two-thirds (66%) of respondents said that having diverse benefits, like financial education support, helps to build commitment to their employer. Yet, the research revealed one-third (33%) of workers surveyed don’t understand how their company-offered financial benefits work. High earners were 64% more likely to say that offering financial education benefits would be effective in increasing their commitment to their organisation. 

Furthermore, young, high-earning employees — those aged 16 to 34 who earn £75,000 or more per year — felt significantly more connected to their employer when they received financial education benefits. Specifically, 66% felt connected to their employer, compared to just 43% of those who did not receive financial education benefits. Additionally, 35% of young, high-earning employees with access to financial education benefits trust their employers, compared to just 15% of those who do not receive financial education benefits.

“The employer/employee relationship can be a stabilising element in an unstable world,” said Jeremy Beament, nudge Global co-founder & director. “Companies can strengthen the connection by providing tools and resources to help employees achieve their financial goals. Finpowerment — the way employers can empower their people to feel confident and in control of their money through financial education — significantly contributes to overall wellbeing.”

When looking at the state of the country as a whole, over four-fifths (81%) of workers feel pessimistic about the UK’s financial future. And due to the volatility of the last two years, 35% have decreased trust in financial institutions. 

Furthermore, 41% of workers say the pandemic has made them increasingly uncertain about how best to plan financially for the future. This has given rise to over a third (36%) who want their employers to provide information on how to grow their retirement funds. Currently, only a few are looking at alternative saving options such as lifetime ISAs (21%), stocks (15%) or mutual funds (8%).

Financial education support at key life moments can help to strengthen the employer-employee bond. UK workers are most interested in financial education that helps them grow a savings account (43%), save for retirement (36%), and reduce debt (30%). Unsurprisingly, Gen Z respondents were most interested out of all age demographics in financial guidance and support in purchasing a home (46%), indicative of the current housing market.  Whilst those aged 25-34 were most interested in learning the ins and outs of investing (26%). 

Other key findings of the research include: 

• Differences in perspective: Men were much more likely than women (72% vs. 54%) to feel hopeful and are also more content (60% vs. 42%) about their current financial situations. Women have also received disproportionate economic harm during the pandemic, being twice as likely as men to lose their jobs and take on more child and family care responsibilities.
• High concern around inflation: 95% of workers are concerned about inflation impacting their day-to-day life and purchasing power, with 53% of those respondents being "very concerned." High earners were the most concerned, with an astounding 100% of respondents expressing concerns about inflation affecting their day-to-day life.
• The tenuous tie between companies and their employees: 71% of workers believe that companies view workers as interchangeable and easily replaceable. 48% say they show up to work exclusively for the paycheck. However, nearly two-thirds (63%) of high earners said that their relationship with their employer goes beyond being purely transactional, compared to only 28% of low earners. 
• The desire for employer investment: Over a third (38%) of respondents whose employers do not offer financial education or financial management tools said they would utilise them if they were offered. 

“The Great Resignation is happening because companies haven't created long-lasting bonds with their people. Since money worries can significantly impact mental health, financial education is a gift that the employer can give to the employee that has a massive impact on their overall well-being,” explained Jeremy Beament.

Please find a link to the report here.