Financial well-being for employees is a growing concern‡ across the nation for many business leaders and CEOs who have seen a decrease in productivity firsthand when employees are concerned about their financial standing. According to a recent survey from FinFit, a provider of financial wellness solutions, many Americans are missing time at work due to financial burdens.
David Kilby, president of FinFit, believes that more employers need to take additional steps to reduce some of the financial pressures that burden employees.
"Even if you're making a decent salary, it is difficult to concentrate on work when you're worrying about how to pay this month's bills, or to find the money to cover a health emergency, a necessary car repair so you can travel to work, or an educational expense for a child," he said.
The survey, which took responses from 250 business executives and owners at companies with 200 to 500 employees in the U.S., revealed that 71 percent of respondents said a tough economy has caused a significant number of employees at their companies to live paycheck-to-paycheck. In addition, 86 percent of respondents said financial stress was a major cause in decreased productivity and absenteeism, while increasing distraction in the work force over the past year.
Companies 'recognizing' the issue
Nearly four of five respondents said their companies do not offer any sort of lending program to assist their workforce if a financial emergency or burden were to hit. Around 50 percent think that a program providing financial education and support in the workplace would help employees be more productive.
The majority of respondents - 69 percent - said they think employees at their companies, if offered, would like to participate in a program that could help them pay for healthcare coverage premiums, deductibles and co-payments.
"We are seeing more employers recognizing that this is a real issue and as a result, starting to think about possible solutions," Kirby said.
The biggest reason respondents believe companies should provide loans or an aid program to its workforce was because of emergency health care costs. Nearly 80 percent claimed that emergency hospital bills were the best reason to offer assistance to employees.
Getting away from financial stress
But financial stress that an employee feels can't all fall on the employer. A person must take accountability‡ for their financial decisions and look to improve any mistakes made in the past.
Nancy Anderson, a contributor at Forbes, said one of the first steps to upgrading your financial well-being is to better understand credit card debt.
"The first thing you need to do to get out of debt is stop the bleeding," Anderson said. "Many people still use credit cards and still try to take out loans."
Anderson implores workers around the nation to curb their credit card usage for a few months. During this time, she said it's crucial to regularly pay off the balance, which will give you an idea of how to live within your means. Once you start understanding that you shouldn't make purchases you can't afford, you can start paying off the credit card with the highest interest rate, and then move on to the second highest if you have multiple cards.
Check for errors
But mistakes with credit can happen. Anderson asks Americans to check their credit report for errors. She said you can visit AnnualCreditReport.com for a free credit report from the three major credit bureaus.
"Look for errors that may be dragging down your credit score," Anderson said. "There may be something that doesn't belong to you or something that's been settled and should be removed."