How Financial Coaching Can Help Worried Workers

Did you know that finances and the economy are among the top stressors for Americans,¹ and those worries carry over into the workplace? It’s true. In the 2022 PwC Employee Financial Wellness Survey, 76% of stressed employees said financial worries have had a negative impact on their job performance.² Helping workers fine-tune their household budgets could help reduce that stress.

Consumers who have a budget feel more in control, more confident and more secure than their peers who don’t have one,³ but for some employees the task of overhauling their budgets on their own may feel overwhelming. In fact, 96% of HR leaders and 89% of U.S. employees say their companies need to improve on helping them understand how to maximize their financial benefits.⁴ That creates an ideal opportunity for employers to offer assistance in the form of access to financial coaching and planning tools. Cultivating a more financially resilient workforce can help boost productivity and engagement—a win-win for both your workers and you.

Employees may be worried about everything from a spouse’s unemployment to current news headlines to a drastically reduced retirement account. Such concerns necessitate the high-touch, ongoing support that financial coaching can provide.

Employees who keep to a budget –under normal circumstances—are ahead of the game but may need to make some adjustments. For those who don’t, now is a good time to get into the habit. Here’s how a financial coach can help:

• Taking Inventory. A good budget needs to be personalized, reflecting an employee’s current reality, but it should also have flexibility as circumstances change. If someone in an employee’s household has experienced a reduction in income, a coach can help them build a budget around their new situation and think about how savings may play a role.

• Reducing Expenses. This financial coach can play the role of a neutral third-party and can guide employees through frank conversations with other members of their household.  They can help employees decide which discretionary items might need to be put on pause and offer guidance that can help minimize disputes in potentially stressful conversations.

The coach can also help make sure that the employee is taking advantage of any cost-cutting benefits available through their employer. Those who aren’t taking advantage of discount programs or transit benefits (if available), for example, might find that doing so will stretch their benefits further.

• Putting Technology to Use. There are a variety of tools—from mobile apps and online tracking tools to more traditional budgeting spreadsheets that can help employees stick to a budget. Financial coaches can help workers select the best tools for their situation (including financial wellness tools through work, if available), and help them get into the habit of using them.

• Supporting Financially Responsible Self-care. On top of the stress, living within a tight budget can lead to feelings of deprivation which can also take a toll on workers’ mental well-being. Working with a financial coach can help them approach money decisions more mindfully, reducing the financial stress.

The past few years have required workers to make a lot of adjustments—to their schedules, to their work and to their finances. With the help of financial coaches, your workforce can implement some thoughtful changes that can help make a big difference in preparing for the road ahead.

Learn more about Morgan Stanley at Work, helping companies and individuals wherever they are on their journey of wealth creation.