Umesha Mathugama
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22 Apr 2024
Mental Health and Financial Wellness
In the light of the major economic crisis and global layoffs, the discussions on the connection between financial stress and mental health have been intensified. Even the adage “Money can't buy happiness” has been a longstanding belief, the current economic landscape has highlighted a significant link between one’s finances and mental health, giving the above adage a new interpretation. Money, being a most dependent element of current lifestyle, this article will explore the linkage between financial stress and mental health and there on how companies could help the financial well-being of their employees. Let's explore how this correlation could be understood and addressed.
How Financial stress and mental health is linked?
The connection between financial stress and mental health demonstrates a cyclic connection. On one side the stress of financial issues affects mental stability while on the other side, a person dealing with mental health issues will make it harder to manage the finances. This situation will then lead to elevated financial problems multiplying the effect on mental stress. Simply if you don’t have sufficient income to cover the necessary daily expenses or are worried about current or future finances, this financial stress will arise. The level of financial stress is not the same for all where depending on one's personal and contextual background.
Financial health is regarded as one of the five key dimensions of employee well-being where financial stress stands as the number one source of stress for them, harming their workplace performance. Therefore, this issue will lead to the overall productivity of the workplace if the majority of employees suffer from financial stress. Taking this into consideration, companies need to support their employees to acquire better mental health while facilitating financial well-being.
So now on the article will move forward with the necessary actions a company could follow to achieve precautions for this ever-increasing problem.
1. Providing a Fair Compensation
The primary expectation any employee has from their company is a favorable salary for their effort. Implementing regular salary reviews could determine if an employee is being rewarded with a sufficient amount for his talents and time. This fair salary providence not only covers their basic expenses but also motivates them towards their profession as the personal financial burden is over. As a secondary benefit, the productivity of the workplace could be maintained with a financially satisfied workforce.
2. Grants to Overcome Hardships
Within the dynamic flow of life, employees will certainly have to deal with unexpected burdens due to natural disasters, economic fluctuations, and other family hardships. These situations could create huge financial stress on them due to their unpredictability. During such challenging instances, the companies could offer them financial grants. These grants could be established by collecting donations to a specifically allocated fund over time. So that immediate support could be given to the affected employee without any hesitation.
3. Employee Discount Programs
This has become an increasingly popular strategy within many organizations to support employee finances. Through the discount offers the employees could get a chance to save money daily as it reduces the expenses for various goods and services. Even though this is a well-recommended strategy, proper discussions between the employer and employees need to be done within the selection of certain goods and services in the discount program to maintain its effectiveness.
4. Financial Education Programs and Resources
Apart from paying the employees, the companies could facilitate them with proper instructions to manage the finances through various workshops. Small chat sessions on various financial concepts could be done by devoting some extra time. Financial wellness educational programs could be incorporated with the aid of industry experts to educate the employees to boost their financial IQ level. This will lead them to make effective decisions on expenditures, budgeting, and savings and to set future goals.
5. Offering Health Savings and Retirement Plans
Health savings could prepare them to stand strongly in front of unexpected healthcare costs. This could include the employee and immediate family members with medical emergencies. Also, this could be provided as disability insurance to employees who are unable to work due to sudden medical issues. The offerings of retirement plans could prepare the employees' mindsets to save a portion of their income for future use.
In addition to the above key strategies, with the advancing technologies, companies could introduce different financial planning software and encourage the staff to use them.
In conclusion, the correlation between mental health and financial stress underscores the crucial need to acknowledge the financial well-being of employees in companies within the current and upcoming economic climate. Although not all companies can implement every discussed strategy, depending on their size and standards, they still could utilize the most supportive approaches.
