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6 ways COVID-19 changed financial wellbeing

The pandemic has proved the ultimate stress test for employees’ financial wellbeing. The real challenge for employers is in the delivery of a successful financial wellbeing strategy. James Corke explores.

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in. These articles are intended for employers and HR professionals, not for individual investors.

Financial wellbeing is a hot topic. Employers have long known that money concerns can impact performance, a fact that was underlined by Close Brothers from research back in 2019, which found that 77% of employees said that money worries impact them at work.

For those employers that were starting to make plans to tackle this, along came COVID-19. This proved the ultimate stress test not just of employee’s financial wellbeing, but also their physical and mental wellbeing as well.

Given that 29% of British households estimate that the economic situation in their household will be worse post-COVID, this suggests that the events of the last year should put financial wellbeing firmly towards the top of most employers’ agendas, if it wasn’t already. However, the real challenge for employers has always been in the delivery; what you discuss, who delivers it, when do you do it and most importantly where do you start?

Here at Hargreaves Lansdown, I’ve been running the team that has been delivering financial wellbeing sessions for our members for the last few years. Typically, we would do this in person, travelling to our clients around the UK and giving them an opportunity to hear more about their company pension scheme, and giving them time to have a one-to-one meeting should they wish to discuss anything personal to themselves.

A company pension will often be the backbone of your employees’ retirement plans, but it doesn’t mean they don’t have other questions around their finances that are more for the here and now. When we are on site, we also run sessions for employees covering subjects such as how to build a deposit, options for saving for children, and how to ensure they are building financial resilience.

As you can imagine, since March we haven’t been travelling, and have simply switched to delivering our approach to financial wellbeing via webinars. Things have changed a lot in the last year in the way we work, and it’s quite possible that these changes will have fundamentally altered the way you and your employees work and communicate in the future. Taking that into account, if you’re thinking about how you can best deliver financial wellbeing to your employees, here are the things to consider in a post-COVID landscape.

1 - Delivery

A big challenge employers face is offering the same levels of service to all their employees, no matter where they are based. For employers with multiple offices of varying sizes, this can result in smaller offices sometimes being at risk of being left out, or the members expected to travel to a different location if it is being delivered in person. This approach can feel unequal and ultimately could lead to less engagement, so the ability to ensure all employees get the same level of service is really important. As you can imagine, the inability to speak to people in person has dramatically increased the use of tools such as Microsoft Teams and Zoom. These do have significant benefits, enabling us to talk to much larger audiences. It also means you can talk to people across all your offices, ensuring they all get the same information and support.

2 - There’s still no ‘one size fits all’ approach

Whilst the use of remote sessions gives greater reach, it’s still important to recognise that even with the ability to potentially reach more members, not everyone can use these tools. For example, you may have sections of your workforce that don’t always have access to a computer, or it may be hard for them to take the time out of their day, particularly if they are working around childcare. As such, we record all of our sessions as we have found that employees and employers have really valued the ability to watch them at a time they can really focus. Of course, using a recording means you lack that personal touch that you get when it is being delivered live, so we’ve also offered some of our members the opportunity to have a 1-2-1 outside of the typical 9-5 working day, to give them the chance to ask the questions relevant to them at a time that works best with their hectic schedule.

You can view some of our previous recordings on our Youtube channel:

watch previous recordings

3 - Reacting to real time events

The ability to run sessions remotely has enabled us to be much quicker at reacting to what’s going on around us. Just as employers were starting to send employees to work remotely, there was a Budget changing the pension contribution limits for higher earners. The use of webinars meant that we could get quick communications out to our members, through a medium that was the least imposing to them, and which covered the pressing issues in the news at the time. It also gave them the opportunity to ask the questions that matter most to them through our live Q&A in each session.

As COVID-19 was taking its grip on the world, there was a barrage of news headlines around what was happening to investments. We ran multiple sessions in April through to August covering how volatility might affect pension investments, giving up-to-date information around investment performance, rather than focusing on the finer points of how a pension works. As you can imagine, moving away from pensions and covering subjects such as debt management and how to build financial resilience have been popular during COVID-19. In particular, we’ve also seen a lot more interest in sessions around getting on the property ladder. This topic typically appeals to a younger audience and is a key concern for those under 40.

4 - Timing is even more crucial

As with all presentations and webinars, it’s not just the subjects that matter, but what is contained within each session, and the length of them. At Hargreaves Lansdown, we can talk about finances for hours, but that’s not what you or your employees want. During COVID-19, we all had more time, but there were also more distractions. As such, we produced shorter, more concise sessions with the clear directions to where our members can go for further support or to understand the subject in more detail. We also produced shorter video content covering key subjects, to make it easier to digest information on key topics. We also felt it was important to run live sessions at different times of the day, again to offer the greatest possibility for members to attend if they are juggling things at home or have moved away from conventional working hours.

5 - Highlighting the small wins

It’s clear that the impacts of lockdown were not the same for everyone. It may be that some of your members had more time to deal with tasks that have routinely been put aside. As such, we ran sessions focused on tasks that we know have historically been low on the priority list. Within every workforce, there will be members with multiple pension pots from previous jobs. This has been a perfect opportunity to get them in order, and where possible, look to simplify their affairs through transferring. We’ve also been highlighting other bits of admin such as completing a nomination form for their pensions should the worst happen to them, which is often overlooked. Finally, we also recognise that for some members, they may as a consequence of the lockdown have had greater disposable income, due to everyday cost savings, for example around commuting. So we’ve been highlighting what their options are for that.

6 - It’s not just your employees that have worries

It may be that you feel that your employees have been protected from the worst of lockdown. Maybe you haven’t had to furlough, and employees have been able to switch seamlessly to working remotely. However, whilst your employees might not be directly affected, it may be that there are members of their household who are. According to The Money Charity, 30.4% of UK households have experienced an income reduction in 2020. The sessions that we run are intended to be universal and contain practical information around additional, independent support that can still be of use and comfort to not just your employees, but those in their families too.

And one thing that hasn’t changed – the need to actually talk to someone on a 1-2-1 basis. Since March 2020, we’ve run over 3,000 individual meetings with our clients to help them make their own investment decisions. These have been via a combination of telephone or virtual meetings. Presentations en-masse are great for getting key messages across to large audiences, but equally we know that our members really value the ability to talk to someone directly about their options. So it’s important that any financial wellbeing strategy takes that into account, as well as signposting the many resources that are available.

Clearly we haven’t had the start to 2021 that we would have hoped for, but hopefully as we move through the year things improve and we have more freedom. However, I think it’s clear to everyone that whilst there have been difficult times, out of these we have all found new ways of communicating to colleagues and members, and we’ll be looking to harness the best of these going forward.

We now offer a financial wellbeing service independent of our workplace pension. Find out more about how you can offer financial education to your employees here:

our guide to financial education

More articles

Important notes

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in. These articles are intended for employers and HR professionals, not for individual investors.

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