Employees are the backbone of an organization, and healthy employees could mean the difference between its success and its failure. This holds true even for non-government organizations (NGOs), which is why it’s important for NGO leaders like you to focus consistently focus on staff needs. It’s just as imperative that you pay attention to everyone’s financial health, as it could present challenges to both their mental and physical well-being.
Unfortunately, some members of your team might be financially unhealthy, especially when you consider how the cost of living in the U.S. increased by 2.3% in the past year alone. In contrast, median wages adjusted for inflation have declined by 9% since 2006. Add to that the pay cuts necessitated by cost-cutting measures during this pandemic, and you’re likely looking at a staff under considerable financial duress.
This is the reason you need to pay close attention to your team’s financial wellness, as it is directly tied to their mental and physical health. That said, let’s take a closer look at these connections and how you can help cultivate positive financial health for your employees.
Money and Chronic Stress
The American Psychological Association reports that 72% of the population is stressed over money matters every month. From thinking about their mortgage or rent to investing in their 401(k) and even pondering over their children’s tuition fees, this financial stress can take many forms, which could also result in chronic stress.
Granted, stress is common in any workplace; however, chronic stress is quite different and can have detrimental results on overall health. Chronic stress lingers for a prolonged period, making it difficult for the body to deal with. What’s worse is it can gradually lead to physical problems, like increased blood pressure, a faster breathing rate, and higher levels of muscle tension. And these problems will worsen if they aren’t addressed immediately.
What’s more, financial health and physical health can affect heart health, too. Medical News Today reveals that stressing over finances can increase the risk of a heart attack 13-fold, while work-related stress can make you six times more susceptible to it than a regular person.
A Domino Effect
This unhealthy combination of mental and emotional pain can cause your employees not to function properly and ignore their health concerns in fear of any additional costs. And when it comes to mental health, financial worries can induce anxiety.
And the more anxious someone is about money, the less likely they are to deal with it properly, Atlanta-based psychologist Dr. Mary Gresham shares. “Many people who are deeply anxious about money will handle that anxiety with avoidance, she says, in an article on Marcus about the link between physical and financial health. Unfortunately, their avoidance increases their anxiety, and then they want to avoid even more. The latter only exacerbates the situation, while also triggering other unhealthy coping mechanisms, such as drinking and smoking.
All of this can soon snowball and result in drastic consequences for your employees’ overall health. If you think these are all individual problems, it’s essential to understand that your team’s collective productivity will definitely take a hit. Not only will your staff be distracted and demotivated to work, they’ll also take more sick days than usual.
What Can You Do?
First thing’s first: create a welcoming environment. Most people who feel anxious tend to think that they’re alone as they struggle, which is why you should consider adopting an open-door policy so staff will feel that they can talk to and trust their colleagues about their personal situation.
Since money is a sensitive topic, it’s crucial that you break barriers, as a previous post on financial literacy by Tim Boyes-Watson discussed. A good way to do this is by asking your finance staff to meet regularly with other teams and discuss not only the organization’s financial performance and status but also topics related to personal finance.
You can also hold seminars regarding financial management to guide your employees without making them feel uncomfortable. Just make sure that the language used in these seminars is simple and plain so that non-finance staff can grasp the concepts better. Structure these seminars, too, in a fun and interactive manner to engage everyone and get them to participate actively.
For a more personal approach, you and your HR team can devise a financial wellness program with the right resources to help advise them through their woes. You can also consider implementing company programs that directly address financial problems, such as 401(k) matching and childcare assistance.
Your HR staff can also help them combat this complex health problem by designing work initiatives that can help alleviate the stress, such as launching a wellness challenge, hosting monthly yoga sessions, and introducing healthier food into the pantry.
Lastly, if you’d like to further improve your team’s financial literacy, consider bringing in the experts to talk about everything related to finance. Humentum’s consultancy services offer expert advice and best practices in the core areas of your organization, including taking better care of your employees’ overall well-being.
Eva Hopkins is an HR manager-turned-financial advisor. She began her career working for a local nonprofit, and has stayed true to her roots by offering financial consultation to nongovernment organizations that need advice about finance.