Insights

Panel discussion: Downing Street Briefing.  Financial Wellbeing Forum 24.  Three women participate in a discussion.

How behavioural science plays a role in money decision-making

“People were coming up with custom strategies to fit what they needed - but it required constant decision-making under pressure." - Anne Angsten-Clark, Nest Insight As financial wellbeing moved up the board agenda, salaried executives unintentionally made policy decisions in a vacuum - clouded by their personal financial circumstances and lived experiences.We heard from two of the UK’s leading researchers on financial wellbeing that it’s time for a reality check.An underserved majority - 25 million people just in the UK - are earning a volatile income. Many are resorting to financial coping tactics outside mainstream financial services. Some are making as many as 150 financial decisions for their household every month. Some actively choose lower-paying jobs which offer more predictability.In world-first research, we saw how lower-income workers are underestimated by their higher-earning colleagues. Not only for their financial savviness, but their ability to find workarounds, provide for others and live a meaningful, dignified life. This can have a detrimental impact on workers, as these higher-earners are often the ones making significant workplace decisions, surrounding pay and benefits.To really understand how money works for their workforce, employers will have to confront complexity. Those who do will find direction on ways to provide far more meaningful financial support to more of their people.

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19 Dec 2024
Woman reading "The State of Financial Wellbeing 2024" report, highlighting employee financial wellness in the workplace.

Financial wellbeing action-plan for employers

There is much work to do - but there are clear steps employers can take, to shift their financial wellbeing strategy from words into actions. The recommendations below are practical and proven for improving financial wellbeing and you won’t go amiss by implementing as many of these as you can. Opportunity:Volatile working hours create shaky financial foundations. Lower earners are more likelyto experience volatility, and this links to worse financial outcomes. Recommendation:Aim to meet the standard for living hours, as provided by the Living Wage Foundation. The Living Wage Foundation has created a standard for employers called Living Hours. In it they outline three commitments employers should make to provide financial stability for employees. The Living Hours standard calls on employers to provide the right to: 1. Decent notice period for shifts: of at least 4 weeks’ notice, with guaranteedpayment if shifts are cancelled within this notice period2. The right to a contract that reflects accurate hours worked3. A guaranteed minimum of 16 hours a week (unless the worker requests otherwise) Opportunity:A regular savings habit is strongly correlated with better financial satisfaction and lower financial worries. Lower earners have 8x less savings than higher earners and are more likely to have £0 in savings. Recommendation:Implement a payroll savings programme and ideally structure it on an opt-out basis so that employees build up savings by default. Access to an appropriate savings product is an important component of financial inclusion. There’s a strong evidence base that payroll autosave is a highly effective way to get individuals on low and variable income to create a savings habit and start building a savings buffer. Recent research from Nest Insight shows that savings participation can reach as high as 71% of eligible employees with this approach. Wagestream has been an active participant in this savings research trial, and as such can already implement opt-out payroll savings for employers. There are also many other pathways to delivering a successful payroll savings programme. Nest Insight has written a guide for employers outlining different options for making this work, and the technical and regulatory considerations for each one. Opportunity:There’s an action gap when it comes to implementing well known financial behaviours.Individuals know what they should be doing, but struggle to make it happen. Recommendation:Review your workplace financial wellbeing programme and benefits through the lens of how action-oriented they are and prioritise providing financial security benefits that are useful and accessible for the whole workforce. Be aware that the financial circumstances and needs of the HR team who assess these offerings will often be very different from the financial circumstances and needs of the workers who use them. Focus on providing a wellbeing toolkit that’s tailored to the needs of your workforce and considers their circumstances including volatility of earnings. Financial education can be helpful, but unless it’s paired with actionable and accessible financial security tools it’s likely it will fall short of the mark. Download your copy of this action-plan. ","post_tag":"Action-plan

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15 Nov 2024
Panel discussion at the Financial Wellbeing Forum 24 on building a board-proof people strategy.  Speakers include CEOs and other executives.

A wellbeing offering that your exec-team will love

Wellbeing? It’s a strategic fundamental. And it should be a long-term outcome of work” - Peter Cheese, Chief Executive of CIPD You won't struggle for conversation topics, the next time you're stuck in an elevator with your CEO. Recruitment. Absenteeism. Cost of living. National Insurance. Employment rights bills. And that's just the start of it. As four industry heavyweights took to the stage, we heard a rallying cry to People leaders: take this to the board, and don't back down. The panel were united in imploring teams to start at the top, encouraging more conversations about mental and financial health from executive level downwards. This shift necessitates a cultural transformation, where wellbeing is embedded into daily operations, not treated as an afterthought. Investing in comprehensive wellbeing initiatives fosters a more resilient and engaged workforce, ultimately driving sustainable business success. Prioritising employee wellbeing is no longer a luxury, but a critical component of a thriving, modern organisation. The goal? Get your organisation off the back foot, and onto the front foot. Take your wellbeing strategy from 'coping' to 'empowering' - from mitigating the wellbeing effects of your colleagues coming to work, to making their wellbeing better because of coming to work.

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7 Nov 2024
Panel discussion: Downing St Briefing. Financial Wellbeing Forum 24.  Three women participate in a discussion, seated in chairs on a stage.  A YouTube play button is overlaid on the video.

Why workplace savings is a game-changer

“Everyone should be able to benefit from financial products and services which suit them - but many aren’t able to.” - Economic Secretary to the Treasury Gone are the days of financial education. Here are the days of financial action. That was the message as three leading experts on financial wellbeing, after a rousing call to arms from the UK’s Economic Secretary. The new UK Government will drive up focus on inclusion, and new research increasingly suggests most consumers do know what good financial habits look like - but can’t access the services they need, or struggle to take action.Savings could close the intent to action gap, as auto-enrolment savings moves into legislative consideration after powerful trials run by Harvard University with Wagestream, Co-op and Bupa. Take action Lean into changeAfter a decade-long vacuum of employment changes, Labour’s Employment Rights Bill is just the beginning. Turbulence is inevitable - but a raft of consultations will open up opportunities for employers who lean in and shape the new world of work Challenge preconceptionsMoney can be counterintuitive - having access to flexible pay, for example, doesn’t drive down workers’ desire to also save for the future. Meanwhile, new research highlights higher earners - who make decisions about financial wellbeing in workplaces - are underestimating the savviness of lower-earner colleagues Target ‘hard to reach’Consider that the colleagues who most need help may be the last to proactively use a helpful benefit like payroll savings, and think about new ways to engage them - like flipping the default to automatic enrolment

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29 Oct 2024
Panel discussion featuring five speakers seated on stage, sharing insights and engaging in conversation.

Therese Procter announced as Financial Wellbeing Forum Chair

I’m currently the Chair and co-founder of a startup organisation called MeVie, a Senior Partner with HR consultancy OrgShakers, a Global Advisor for financial wellbeing business Wagestream, and now Chair of the Financial Wellbeing Forum. I’ve been fortunate enough to be featured in the Top 15 of HR Magazine’s list of Most Influential HR Practitioners on six occasions, and have formerly been a Chief People Officer at a leading retail bank, as well as spending 30 years with Tesco PLC working across a range of HR and strategic roles. Outside of work I’m a mother of two wonderful daughters, and my hobbies are all about being active and keeping moving – cycling, running, trekking, you name it. I’m also big into fundraising; I’m planning to embark on a climb up Kilimanjaro in January to raise money for the Breast Unit for The Princess Alexandra Hospital NHS Trust, so I’m currently training for that adventure! Why have you decided to take on the role of Chair for the Financial Wellbeing Forum? Financial wellbeing has always been a passion of mine. I’ve spoken on, written about, and worked with companies that are dedicated to improving the financial wellbeing of people, and I think that it’s so important for there to be a platform where this knowledge can be shared and accessed by all. This is why when I was asked to be Chair for the Financial Wellbeing Forum (FWF) I didn’t hesitate in accepting. The FWF are dedicated to sharing such important thought-leadership that will help to improve people’s financial literacy and educate them around better supporting their own financial wellbeing, and I couldn’t be more honoured to be a new addition to their organisation. And the fun doesn’t stop there, because I will also be chairing their annual Financial Wellbeing Forum event taking place this October. It is such a privilege to be able to convene with such a distinguished group of experts and organisations and discuss the importance of financial wellbeing in detail.","post_tag":"Leadership

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3 Sept 2024
Abstract illustration of a human head with a circuit board inside, symbolizing the integration of technology and human intelligence; small figures work on the circuit board, suggesting collaboration and development in AI.

Why scarcity-alleviating benefits improve business outcomes

Financial wellbeing benefits are playing an increasingly important role in supporting employees with all aspects of budgeting, saving, and education, but they can equally support in flipping the scarcity mindset, alongside tweaks to workplace policies and processes. 1 in 5 workers need help with commuting costs The challenge: An increasing amount of external research confirms a correlation between absenteeism and financial stress. There are many factors that might play a role in this, but one that is often overlooked is the cost of the commute, which might be driving workers to extreme measures - such as calling in sick. The difficulties and expense that the work commute presents may not be immediately apparent to those who work a 9-5 office job, where transport options are far more varied and available; however, deskless workers are often working unusual shift patterns, evening and night shifts, and public holidays - and can be left short of choice. Take a nurse who is working the night shift at a hospital, finishing in the early hours, which potentially leaves a taxi home as their only transport option - this is where the cost of commuting becomes a burden, and absenteeism becomes a viable option to tackle fears of financial scarcity. The plan: The UK’s largest, most in-depth study into flexible pay, revealed that 22.1% of people use flexible pay to cover the cost of their commutes. This finding highlights a universal expense that is often overlooked. Internal policies and benefits are usually built to support colleagues in the workplace, but do those policies support them in reaching work in the first place? Even small changes to policies and processes can make a really positive difference to teams; for instance, the frequency with which expenses are reimbursed, or overtime is paid. Flexible work is also becoming a popular term, which covers a lot of different working arrangements; but again, even slight tweaks, such as a allowing some flexibility to shift starts/ends, and having a straightforward system of swapping shifts, can potentially save workers time and money on their commutes, and flexibility on necessities like childcare. Additionally, flexible pay is a powerful financial tool when it comes to necessary expenses, like travel. Particularly in instances of overtime shifts or over-running hours, where extra costs crop up unexpectedly, having flexible access to pay can help mitigate the fears of financial scarcity that drive behaviours like absenteeism. ","post_tag":"Research

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22 Jul 2024

Insights

How employers can protect their workers from financial scarcity

Financial wellbeing benefits are playing an increasingly important role in supporting employees with all aspects of budgeting, saving, and education, but they can equally support in flipping the scarcity mindset. Here is an action-plan for employers on how your financial wellbeing benefits can reframe the scarcity mindset into one of abundance. Initiative Action Pay Pay is foundational to employee wellbeing - and will always be the most-valued workplace benefit. Where possible, regular/reliable increases to pay can provide greater budgeting flexibility and boost motivation. Tracking & visibility Tools to help provide shift-tracking and visibility over pay can be effective for managing a scarcity mindset. They can help drive positive decisions around budgeting, and motivate towards taking up extra shifts. Flexible Pay Flexible access to pay is an effective benefit to support employees in mitigating a scarcity mindset. Bills and expenses are not regular in timing or amount - being able to manage these expenses as and when required helps alleviate fears of financial scarcity. Savings Savings are paramount to financial wellbeing, but regular saving can be difficult for those on low-incomes. Accessible or automated savings options, including opt-out options, can make building a buffer manageable and support long-term financial health. Budgeting There are several benefits that can support employees with their budgets. Offering vouchers, discounts, insurance, or access to a rewards platform can all help to create space in a tight budget. State support Many workers are not aware that they may be entitled to government support, or may not know how to find out. There are many providers that offer simple calculators to access this information - which could provide workers with valuable extra income. Communications Providing a holistic set of financial benefits is the first step in supporting employee wellbeing - the next step is communicating them. Take advantage of all internal channels, utilise awareness days, and nominate champions to encourage uptake. ","post_tag":"Action-plan

How workers are being held back by feelings of financial scarcity

But how can a scarcity mindset, particularly one based around money worries, hold employees back from giving their best performance in the workplace? Here are some of the ways in which this manifests itself in the work environment. Absenteeism An increasing amount of external research confirms a correlation between absenteeism and financial stress. In a recent piece of research into how Wagestream’s members use flexible pay to support their budgeting and manage their finances, we discovered that 22.1% of people use it to cover the cost of their commutes. This finding highlights a universal expense that is often overlooked. Internal policies and benefits are usually built to support colleagues in the workplace - whether that's equipment allowances, food and drink, or discounted merchandise; however, do those policies support your colleagues to reach the workplace in the first place? The difficulties and expense that the work commute presents may not be immediately apparent to those who work a 9-5 office job, where transport options are far more varied and available; however, deskless workers are often working unusual shift patterns, evening and night shifts, and public holidays - and can be left short of choice. Take a nurse who is working the night shift at a hospital, finishing in the early hours, which potentially leaves a taxi home as their only transport option - this is where the cost of commuting becomes a burden, and absenteeism becomes a viable option to tackle fears of financial scarcity.","post_tag":"Research

Inclusive Leaders: Caravan's People & Culture Director

Could you tell us about your background? What was the journey to your current position? I'm a high-energy People and Culture leader with over 15 years of experience in a people function and nearly 20 years in the hospitality industry. I moved from Brazil to the UK in 2004 to pursue a degree in Social Communications, which ignited my passion for People and HR. My areas of expertise include team engagement, recruitment, training/learning and talent development. Currently I hold the role of People and Culture Director at Caravan Restaurants and Coffee Roasters and prior to Caravan, I worked at Megan’s, Wahaca and Wagamama for several years. This shaped my 'People Magic' strategy through company expansion and team growth - driving culture and talent development and being instrumental for dozens of new site openings, focusing on culture and nurturing talent. Tell us more about your role as People & Culture Director at Caravan. What projects are you currently working on? What are you most excited about? In my current role at Caravan I implement the business's strategic vision, promoting an inclusive culture, and recruiting and developing top-quality, diverse talent. My people strategies, which I define as “People Magic”, are finely tuned to align with business goals, taking advantage of people analytics and a hands-on approach to ensure more adaptability and measured actions in the changing landscape of the hospitality industry and the world. Currently our 80:20 strategy is a core priority, where we aim to develop 80% or more of our internal teams into management roles, using our newly updated career pathways. ","post_tag":"Strategy

Financial and mental wellbeing: an employer's guide | Wagestream

Stress and anxiety are major contributors to poor mental health. Since 2011 stress has been the leading cause of long-term sickness absence, while in 2018, it was officially declared by the Health & Safety Executive as causing more depression/anxiety in the workplace than musculoskeletal conditions. The impact of stress on mental wellbeing is so severe that a recently introduced ISO standard (ISO 45003) urged employers to tackle the so-called ‘psychosocial’ risks of the workplace [such as poor job design causing overworking/burn-out].But what workplace academics are now increasingly realising is the very great link between financial wellbeing and stress, and therefore the impact poor financial wellbeing has on overall mental wellbeing.There are several indicators that experts say are substantiating this finding. 1. Financial anxiety equates to poor mental wellbeing In recent years, behavioural scientists have unequivocally linked instances of financial anxiety with having a damaging contribution to people’s overall mental wellbeing – the impacts of which can last for several years. A US study in 2019 found more than half of Americans lose sleep at night due to having financial worries. Unexpected expenses, in particular, have been found to cause stress levels that reach dangerous levels. In fact researchers at the University of Georgia have found that suffering serious financial penury, combined with it causing stress at the time, can result in physical health problems many decades later. Simplistically, when people suffer stress, their ‘flight or flight’ parasympathetic nervous system is always ‘on’. This means they are triggering a cascade of stress hormones that cause real physiological changes. Unfortunately, the body can overreact to stressors, creating long-term effects on physical and psychological health. 2. Those in worse financial situations report worse mental health Back in 2017 Willis Towers Watson revealed only 43% of staff were satisfied with their financial situation, and since the pandemic (which has seen millions furloughed and many others on reduced salaries), the numbers worrying about money have spiralled.In recent research released to coincide with World Mental Health Day, it was revealed 9.5 million adults claim to have suffered from mental health issues as a result of financial anxiety. Half of these people worry about the day-to-day issue of making ends meet. 9.5 million adults claim to have suffered from mental health issues as a result of financial anxiety Those still unconvinced about the link between pay and mental health should be left in no doubt by data from statistics from a recent ‘Thriving at Work’ report [PDF], which was categorical in its findings: amongst staff that describe themselves as “financially comfortable,” 41% report signs of poor mental health. But this figure rises to 51% for those describing themselves as “just about managing,” and 67% for those in “financial difficulty.” 3. Poor financial wellbeing links to poor financial decision-making When people have limited resources it’s scientifically proven that they adopt a ‘scarcity mindset’ – whereby all attention is directed solely on how to get through the week/month.This means people with poor financial wellbeing have a harder time making decisions that involve long-term thinking, which is key to financial planning and thriving.What this means is: poor financial wellbeing can be self-sustaining if employees don’t have access to the right tools and this situation can contribute to poor mental wellbeing over time and long-term stress.

Quick tips on helping first-time savers

Given that we are collectively facing one of the largest financial shocks of the last century, with 78% of UK employees worrying most about having no savings or encountering unexpected costs, it is crucial that employees are encouraged to protect themselves.Employers can play a critical role in supporting their employees with saving, and one of the most impactful ways to do this is by launching a savings campaign within your organisation.Here are four key principles to guide your campaign. 1. Know your people Anyone who has witnessed England trying to win the world cup in the last 50 years knows that there is nothing more dispriting than being set a goal that is inherently out-of-reach. Every organisation is made up of an array of entirely unique individuals, and therefore their finances are also totally unique.A savings structure that works for an unmarried, salaried employee, does not work for a zero-hours employee with three young children. Therefore, you should take care to ensure that you have (as far as possible) a realistic awareness of your employee base: income, dependents, financial obligations, and so on, in order to pitch savings content universally and representatively. 2. Focus on building savings habits Starting to save can be difficult – especially for those who have never done it. Savings campaigns should ignite a lasting commitment to saving, rather than set concrete parameters where some individuals, perhaps those who are attempting it for the first time, could fall at the first hurdle.Many of us are familiar with the NHS’s Couch to 5k running programme, and the premise is the same here. To build up a lasting behaviour requires incremental and manageable steps. Even if savings are dipped into to cover unforeseen expenses or smooth out income, the general trend is still upwards, Research carried out by Nest Insight reports that even if savings are dipped into to cover unforeseen expenses or smooth out income, the general trend is still upwards, proving the value of flexibility in the modern financial climate.This flexibility is reflected in the increasing popularity of microsavings and automated savings. An automatic ‘roundup’ feature where any expenditure is automatically rounded up to the nearest pound, with the spare change going into a savings pot, is one example.It’s crucial for business leaders to introduce a savings campaign that allows for flexibility. Why? Because the course of first-time saving never did run smooth, and flexible tools are the universal equaliser.

Is it too expensive for your staff to come to work? | Wagestream

Are employers putting undue financial pressure on staff to get to work when small changes could ease the burden? Internal policies and benefits are usually built to support colleagues in the workplace - whether that's equipment allowances, food and drink, or discounted merchandise; however, do those policies support your colleagues on reaching the workplace in the first place? Here we look at four different aspects of common workplace policies, and unpack how they could be putting undue financial pressure on workers' commutes. 1. Expenses reimbursement Do people wait six weeks to be repaid in your organisation? Long wait times can affect cashflow and budgeting in other financial areas - such as transport and groceries, especially if the expenses are significant and unexpected. Reimbursing expenses on a more regular cycle (especially within the same pay period) can help ease the burden, and ensure employees aren't stretched elsewhere in their budget. Better yet, if expenses are a big part of the job, is there a way to ensure every employee has access or a direct line to a company card? Not everyone needs one, but it’s useful if more people know they have the option to avoid absorbing the cost themselves. 2. Minimum contracted hours If only limited hours are guaranteed across a week and colleagues have expensive commutes, it may be that they are reliant on extra hours to ensure the job remains financially viable. This can cause anxiety and uncertainty, especially if rostering is dependent on short-term factors e.g. the previous week’s performance. Minimum contracted hours became a particular issue during the Covid-19 pandemic as organisations were forced to drop guaranteed hours to cope with fluctuating demand - however, most organisations are now in a better position to provide increased notice and certainty for their people. 3. Overtime pay Many organisations have different pay cycles for overtime and it can result in staff waiting more than a month to be paid for any overtime performed. If staff take overtime pay due to a short-term need for more money, the pay cycle can reduce any positive impact overtime could have on their financial wellbeing - particularly if they're shelling out extra cash to commute to those overtime shifts. Plus, if you pay sooner for overtime pay, you also strengthen the psychological link between work and reward, which may encourage your teams to take on more overtime pay, as they receive the money far quicker. Our recent research into flexible pay demonstrated that workers take on 11% more shifts when they have flexible access to that extra income. 4. Flexible working policies Flexible working is a very big term and means a lot of different things to different people. It’s linked to the nature of the organisation and the industry. But there are lots of examples of how rigid rules on flexible working can make it more expensive to come to work. For example, even a slight flexibility in start & end times can save people cash on car parking, peak time public transport, and extra childcare costs, to name a few examples. Also, allowing staff to easily swap shifts may mean parents who have to do school pick-ups can increase their hours more easily, and avoid imposing a forced cap on their earnings. Financial wellbeing strategies do not only have to look at new benefits and practices, but how existing policies can ensure that low-income workers aren't facing unnecessary financial obstacles; and generating excess worries alongside the already-stressful subject of money. For more ideas and actions to support your colleagues with financial wellbeing, read our recent research: Unlocking the Pay Cycle - which details the objective and subjective impact of giving workers choice over their own pay cycle.

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The Financial Wellbeing Forum brings together the world’s leading experts on employee financial wellbeing to bring you groundbreaking research, world-class events and thought-provoking content on wellbeing at work.

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