Supporting employees through new year financial stress
Welcome to 2024! We hope you enjoyed a healthy and relaxing holiday season. As we kick off the new year, we thought it appropriate to dedicate this issue of GO with Eckler to supporting employees through new year financial stress.
Restart and recharge
Whether you call it the “winter blues,” “January blahs” or simply financial regret, no matter what you celebrate, the start of the year can leave many of us feeling down and unmotivated. The financial burden of reduced income as CPP/QPP start anew, post-holiday credit card bills coming due and the pressures of RRSP season, can make it downright impossible to find the motivation for new challenges – at work and otherwise.
The good news is, as an employer, you can help your employees through these dark days by providing them with tips, tools and motivation to tackle their finances. Whether big or small, formal or informal, this support can help employees recharge and restart their finances so they can bring their best selves to work.
Getting finances back on track
According to a recent BMO survey, one in four Canadians aren’t confident they will be able to pay off their post-holiday bills on time. Imagine 25% of your workforce not being fully engaged because they are worried about paying off holiday debt. Whether the budget has been completely blown or just a little stretched, starting the new year with motivation and help to getting back on track is a great way to support your employees who may be struggling with financial stress. Here are three financial planning basics you can share to help them start the new year right:
Budgeting: Managing how much money is coming in and going out each month, is the number one thing employees can do to gain confidence and financial wellbeing. Employees should start by making a list of how much is spent each month on essentials (mortgage or rent, utilities, car, debt payments, groceries, etc.), non-essentials (restaurants, take-out, alcohol and tobacco, etc.) and how much goes to savings (RRSP, RESP, emergency fund, etc.).
TIP: Reviewing the budget periodically to ensure that it remains accurate is important. Changes in cashflow from pay increases or changes in utility amounts can have a big impact.
Managing debt: With a better understanding of the total amount of money coming in and going out, and where the money goes, employees will be in a better position to ensure they are paying their debt on time, and knowing whether (and by how much) they can cut or reduce non-essential items so they can pay down their debt faster and start saving for their goals.
TIP: Taking advantage of zero or low-interest credit card offers to transfer balances from higher-rate cards can help to ease payments early in the year.
Goal setting: Setting short-term and long-term goals is critical to getting and staying motivated enough to stick with a financial plan.
TIP: Try using SMART goals: specific, measurable, actionable, realistic and timely. 100% Debt-free in 1 year, 3 years, 5 years, or saving $50 a week toward a $2600 contribution to a Registered Education Savings Plan in 12 months are good examples of specific goals.
Helping your employees in other ways
The start of the year is generally a time for setting workplace goals, but financial stressors combined other obligations like child and/or senior care can often hinder an employee’s ability to achieve those goals. Acknowledging that this can be a difficult time of year can go a long way.
Remind your people managers that goal setting sessions are a good time to “check-in” with their team and remind them of the resources available to help. We have listed a few resources below that may help with the “every day” financial stressors.
As we usher in the new year, and look to set new habits and goals, now is the perfect time to share information and provide motivation so your employees can recharge and reset for the year ahead.
GO with Eckler is a quarterly newsletter to help employers and plan sponsors support financial wellness for their employees and plan members.If you would like to learn more about how to support employee financial wellness at work, please contact your Eckler consultant if you would like to learn more about supporting financial.
Please contact your Eckler consultant if you would like to learn more about supporting finances.