If you feel that money sometimes disappears from your bank account as soon as it’s deposited, you’re not alone. Financial stress affects many Canadians: According to a 2017 survey by the Canadian Payroll Association, 41% of employed Canadians say they spend “all or more of their net pay.”
Similarly, many Canadians are living pay cheque to pay cheque. In the same report, 47% of Canadians surveyed said they couldn’t meet their obligations if their pay were delayed by just a week.
Financial stress affects both your personal and professional life. It’s hard to concentrate at work when you don’t know if you’ll be able to pay your bills. But beyond the stress of high credit card bills, there’s a strong connection between financial and physical wellbeing.
How does financial wellbeing affect physical wellbeing?
Research has illustrated the connection between health issues and financial stress. Excess stress from money issues has been shown to cause physical illnesses such as high blood pressure, obesity and diabetes – not to mention the toll it can take on mental health. According to the 2016 Sun Life Canadian Health Index, 29% of Canadian employees are distracted at work by financial issues – and more than 1 in 10 said that financial issues had caused them to miss at least one day of work in the last year. And that can take a toll on productivity.
How employers can foster financial wellbeing in the workplace
Employers have an instrumental role to play in fostering their employees’ wellbeing, says Sun Life’s former Director of Workplace Health, Dr. Marie-Hélène Pelletier. “Financial matters can be a key source of stress for employees and can impact their physical and mental health,” says Pelletier in a 2017 Sun Life report on financial wellness in the workplace. “And that can be costly for employers – from higher rates of absenteeism to lower productivity. With the debt levels of Canadians at record highs, now is the time to focus on financial wellness for your employees.”
3 ways employers can support their employees' financial wellness
Here are 3 ways employers can help their employees manage financial stress:
- Launch financial literacy programs at your office. Many Canadians lack the knowledge and skills to make sound financial decisions, according to a 2016 Statistics Canada report. The survey found that only 31% of women and 43% of men consider themselves “financially knowledgeable.” A practical way to empower employees is through hosting workshops on topics such as budgeting, building an emergency fund and planning for retirement. If you’re interested in launching a workplace financial literacy program, the federal government offers a suite of tools and resources on its workplace financial literacy website.
- Give employees access to financial planning. Having a personalized, written financial plan is a practical way to boost your financial wellness. A Financial Planning Standards Council report surveyed people working with a certified financial planner. It found that 63% of people said that they “worry less about money because of financial planning.” They also stated that their emotional health had improved in retirement.
- Encourage employees to use existing employee-sponsored savings programs. Launch campaigns that incentivize contributions to your companies group TFSA and RRSP programs.
Money-related stress is a widespread issue that affects employees both at work and at home, and top organizations across the country are recognizing the importance of supporting their employees’ financial wellbeing. “Many employers think of financial wellness as being prepared for retirement,” says Kim Duxbury, Assistant Vice-President, Sun Life Group Retirement Services. “It is that – plus much more. Employees need financial wellness support throughout their careers, including the basic tasks of day-to-day budgeting and saving for shorter-term goals.”