Why businesses are trying to improve their teams’ financial wellness – and what you can do to help

By Dean Perlman, Managing Director of credit advisory and mortgage broking business Charter Finance. Dean has a background in law, commerce, banking and property development, with extensive experience in residential and commercial debt finance. 

Are you a business owner, leader or manager? It turns out, the success of your business could lie in the financial wellness of your employees (don’t worry, you don’t have to promote everyone for them to be free from financial stress).

It may seem out of your scope of work, but businesses that invest in their employee’s financial wellness are seeing significant and material impacts on morale and productivity in the workplace. Levels of engagement, productivity and discretionary effort are five times higher than those who have financial stress according to research from CoreData. 

The research behind employee financial wellness

Based on research conducted by CoreData, employers who invest in their team’s financial wellness saw a significant improvement (60.0%) in their wellness and in turn, performance at work.

CoreData however found that only 6% of employees surveyed classified themselves as ‘superstar savers’. This section of savers is defined as having no concerns about their ability to pay their mortgage or rent.

Financial wellness is defined as: 

  • a state of being healthy, happy and free from any financial worries and stresses 
  • being able to live your desired lifestyle for the rest of your life without financial anxiety or fear 
  • having a clear understanding of their financial situation and having the ability to live within their financial means

CoreData research found that of the employers who observed financial wellness in their workplace, 63.3% could identify stressed employees; 43.3% noticed unengaged/distracted employees and 30.0% saw low morale. Loss in productivity is a major problem employers across the country face and a major drag on the profitability of businesses. Across the Australian economy, the cost of these factors is approximately $33 billion each year.

When it comes to financial wellbeing, this has typically been left to remuneration committees, and normally falls into the standard bonus / dividend / profit schemes. In this current economic environment this has been challenging where companies are in many instances going sideways, at best, or backwards.

Mortgage Mapping 

Charter Finance’s mortgage mapping programme helps employees ensure they stay or become financially well while not costing the employer anything.

This programme allows employees who have a mortgage, to manage it as effectively as possible, as well as providing a plan for those who are yet to get onto the property ladder. 

A typical example is as follows:

  • Average mortgage $850,000
  • Average saving: 0.30%
  • $ saving per annum: $2,160
  • Saved Interest reinvested into loan: $90,000 (over the life of the loan)

This saving/benefit is threefold:

  • It effectively acts as an employer sponsored benefit
  • It also helps set them up for a potential deposit for a new future property (all at their current banks expense)
  • It importantly gives them a financial goal to work towards 

There is so much going on in the lives of your team members. Reducing any financial stress they may have allows them to live easier lives and be more productive both in and out of the workplace. 

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