Employees still missing out on financial support

This informal CPD article, ‘Employees still missing out on financial support‘, was provided by Money First Aid, an organisation that offers online courses created by financial experts with industry and training experience to equip participants with the knowledge and skills needed to help others overcome financial difficulties.

Research from Fair4All Finance (2024) estimates that 17.5 million people are financially vulnerable in the UK. When we think of a financially vulnerable person, an employee in the UK earning a monthly salary likely isn't who comes to mind. And employees themselves may not identify with the label, given the feelings of blame and shame often associated with financial vulnerability. And yet, 72% of those 17.5 million people are in full or part time employment.

Financial support is available, whether from government benefits, not-for-profits and charities, local community organisations, or, of course, the growing number of financial wellbeing solutions for the workplace. Most of these however are not utilised by those who could benefit.

• £23bn of state financial support goes unclaimed each year (source: Policy in Practice, April 2024)
• 8 million people need debt advice in the UK, but people tend to wait 6-8 months or longer before seeking it out (Money and Pensions Service)
• Employee Assistance Programmes have an average uptake of 4-10%
• 74% of people have not spoken to their employer about their financial concerns (Wagestream)

So, even when financial support is offered, there remains significant barriers to employees accessing and utilising such support. Why is this?

Barriers to accessing support

The first reason may be lack of awareness. Many employees are not fully informed about the financial support available at work, or from other sources. Consistent and effective communication can be difficult for employers, particularly with deskless workers who are hard to reach.

Stigma surrounding financial difficulties can also prevent employees from seeking help, even when they are struggling to make ends meet. Employees may fear judgement, or even discrimination, from their colleagues or employers, leading them to suffer in silence. This may be particularly true if they feel that financial difficulties shouldn’t happen to ‘someone like me’. And in some cases, people might be in denial about the financial challenges they are facing.

Seeking financial support can be daunting and overwhelming. Finance brings its own technical jargon, eligibility criteria, disclaimers, small print and paperwork, all of which can feel intimidating and deter employees from engaging at all. Some employees may feel disempowered or assume they do not qualify for assistance. Many people considering support have likely spent a considerable amount of time ‘holding it together’ on their own, and may be fearful to give up that sense of control by involving a third party.

Lack of trust in financial services remains a challenge. With so many providers of financial support now available, it is a difficult landscape to navigate. What information is trustworthy? What resources are the most reliable and relevant to me? These are good questions to ask, and not easy to find the answer.

People may also be sceptical of 'free' advice, associating it with poorer quality services, or feel it sounds too good to be true. It can be difficult to differentiate between genuine independent support and those aiming to sell products and services.

Many employees will understandably struggle to find the headspace to tackle their finances. Addressing financial issues requires considerable mental energy. Alongside their workload, responsibilities at home and navigating everyday life, employees may lack the mental bandwidth to tackle these tasks, finding it easier to put them off for another day. This barrier is exacerbated for neurodivergent employees or those facing physical, psychological or behavioural challenges.

So how can employers break down these barriers and facilitate employee access to financial support?

By fostering a supportive and open workplace culture, employers can create an environment where employees feel comfortable discussing their financial concerns and seeking help when needed. But what does this look like in practice?

Building a clearer understanding of the most common barriers faced by your employees is a good place to start, as this dictates what solutions will resonate. For example, if members of your team fear the stigma around financial difficulty, sharing stories of others like them who have accessed support, and how it helped them, can be very impactful. If it’s difficult for your employees to find the time to address their finances, how can you create specific times of the month or year, in person or digitally, to help them carve out the time?

If there is a lack of trust about the advice available, ask your providers to create transparent communications around fees and paid services. For digital solutions, make it clear what security and data protection is in place, and how an individual’s identity will remain anonymous and their financial situation kept confidential.

If employees feel overwhelmed by the various options available to them, create some user personas for each service, for example, ‘if you are…facing these financial challenges… then these services can help…’. Train HR, people managers, wellbeing champions or others in the business to signpost others to relevant support. And there are ways to reassure employees about what happens after they seek support, thereby reducing the fear of the unknown. For example: video guides of how to complete questionnaires, providing email templates to copy and send, or scripts of what to expect when someone calls a helpline.

Lean on the free education and advice that is available from credible, impartial organisations and leverage the power of internal champions. They can help break down the taboos of talking about money, test out the solutions on offer and share their stories, and facilitate two-way communication between employer and employee on what’s working well and what needs to change.

Digital financial wellbeing solutions can provide accessible support at scale. But human connection, conversations with colleagues and hands-on assistance will go much further to alleviating the stress and fear associated with seeking financial help.

Your organisation may already have adequate tools in place to support employees with their financial health. Adding more costly solutions to boost engagement may not be the answer. Adopting a people-focused approach and trying some simple interventions, internal campaigns and facilitating conversations amongst your teams, may be the key to them making the most of what’s already there.

We hope this article was helpful. For more information from Money First Aid Training, please visit their CPD Member Directory page. Alternatively, you can go to the CPD Industry Hubs for more articles, courses and events relevant to your Continuing Professional Development requirements.