Context
In the face of challenging economic conditions, people are becoming increasingly concerned about how they spend, save, invest and manage risks to enable them to protect their standard of living. Neyber is an organisation which aims to support employees in the UK to achieve financial wellbeing, through helping people to access financial education and appropriate products. It has conducted this study to gain valuable insights to inform how it can help employees to improve their financial wellbeing.
The study
The report is based on findings from surveys that Neyber conducted from 2016 to 2018. It includes findings from three workforce surveys (which each interviewed over 10,000 UK employees), and two employer surveys (which each surveyed 500 UK employers). It also draws on the findings of a range of additional research studies that were published in 2017 and 2018.
Key findings
Financial wellbeing is linked to overall health:
- The research found that if employees feel less confident in their finances, this has a knock-on effect on other areas of their life.
- Only 66% of employees felt happy with their financial health, and only 61% with their later life/retirement provision.
- Only 50% of employees said that their company cared about their financial health (compared with 73% who said their company cared about career and personal development, 66% for later life/retirement provision, and 65% for overall wellbeing).
Financial worries are an employee’s biggest concern:
- The research found that UK workers are most concerned with financial worries (30% of respondents). Conversely, employers felt that work-life balance (44%) and workload (33%) were the biggest concerns for employees. This suggests a divergence between employers’ perceptions of staff worries, and the reality.
- The study also found that very few employees turned to their employer when they were concerned about money. Only 5% of employees said they would talk to their manager and only 3% would turn to HR.
Financial worries affect every age group:
- The research showed that different age groups typically had different concerns, with younger age groups more concerned about mental health and work-life balance, and older age groups more concerned with later life and physical health. However, ‘financial worries’ were the top concern for people aged between 18 and 54, and were within the top three concerns for people aged between 55 and 64.
- The report also highlights other research conducted by the Money Advice Service and BritainThinks. This study found that 61% of young adults agreed their life would improve if they could manage their money better and 52% had spoken to a friend or family member about money management. 44% of young adults had made a budget to manage their money better, whereas 30% had used an app for money management (however note the report does not reference what the sample size was).
Other factors:
- Over half (56%) of 18-34 year olds were uncertain about the impact that Brexit would have on their finances. Other factors that affected 18-34 year old employees’ perceptions of their own finances were UK politics (49%), US politics (40%), and tax and legislation (42%).
The impact of financial worries:
- Neyber’s research found that there was an increase in stress, anxiety, loss of sleep and depression as a result of financial worries between their 2017 and 2018 surveys.
- 60% of respondents feel that their behaviour changes when they are under financial pressure. Employers also noticed this change; 69% said that they believe that their employees’ job performance is negatively affected when they are under pressure.
Other findings:
- Only 30% of respondents said that they had a savings buffer that could support them for more than six months.
- Nearly a third (28%) of respondents aged 18 to 54 never checked their credit scores.
- When asked about who they would turn to if they had money worries, only 44% of UK employees in 2018 would choose to speak to their partner.
Points to consider
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Methodological limitations: There is limited discussion of Neyber’s methodological approach (including details on particular methods) so it is difficult to ascertain what the limitations are.
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Relevance:This study is relevant for any working age adults who are concerned about their finances, and for practitioners who are interested in the financial experiences of young people.