Reducing Financial Stress Increases Employee Productivity

According to a recent survey conducted by the International Foundation of Employee Benefit Plans, two-thirds of employers offer financial wellness programs to help their employees manage personal finances. Not surprising, considering 80% of employers agree that employees’ personal finances impact job performance. Employers offering financial wellness programs, which can include everything from student loan repayment assistance to live financial counseling, see a healthy return on investment by creating a more productive workforce.

The American Psychological Association released a survey showing that money is the number one stressor for Americans.

Employers may not feel like it is their place to take on their employees’ personal finance issues, but remember that the primary purpose of holding a job is to maintain financial stability. If you don’t care about your employees’ finances, that’s going to have an effect on turnover. Part of the stereotype of the job-hopping millennial comes from a perceived need to seek jobs with better benefits that help overcome debt, improve savings, eliminate medical expenses, and address the countless other financial challenges facing the working class today.

Even more pressing, employees dealing with financial hardships don’t have their minds entirely on their job. By providing a financial wellness program, you not only attract and retain employees, you can improve productivity across the board.

Employee Stress from Financial Problems

Stress occurs when a person feels unable to meet the demands put on them. This can occur when a person feels they have too much work to do, when family drama takes up too much of their time, or when a person feels they have lost control of their financial situation.

The most common financial stressors include:

  • Credit card debt
  • Retirement
  • Children’s education expenses
    or childcare
  • Basic living expenses
  • Medical expenses
  • Supporting elderly parents
  • Supporting adult children
  • Paying off student loan debt

Many, perhaps most, people deal with more than one of these stressors. These concerns make it hard to focus on work. Employers should understand how having stressed employees can affect their business.


It’s not always possible to leave personal problems at home when you come to work.

Financially stressed employees may use work time to check their bank balance and count the days until payday to reassure themselves that they’ll be able to cover this month’s rent. They may mentally calculate how hard it will be to afford groceries this week. Or, they may actively try to work but find their mind keeps wandering back to their financial problems.

Now that smartphone ownership is practically a given, this has become even more difficult to avoid. People are constantly alerted to financial issues via phone, email, mobile app, or text message and those updates get even more frequent when there’s a problem. It may not seem like much, but the time employees spend thinking about their finances adds up.


Most parents of young children report taking unpaid days in order to stay home with children when their childcare becomes unavailable. Likewise, elderly dependents without reliable care frequently force employees to miss work for doctor’s appointments, nursing home emergencies, and other elder care issues.

Supporting elderly parents and young children with high quality care can come at a tremendous expense. Paying for full-time childcare can cost upwards of $20,000 per year. Nursing homes can cost nearly four times that amount. It may only be a couple of days per year, but if an employee is using vacation time to take care of their family, then they’re not using vacation time as it was intended—to lower their stress levels and be better focused at work.


Unfortunately, businesses are at risk for internal theft. It’s estimated that over $50 billion is stolen annually from U.S. businesses by employees. 75% of survey respondents stated that they have stolen at least once from their employer. Employees with financial stability are less likely to commit fraud. White collar crime committed by internal employees costs the average company in the United States nearly 6% of its total annual revenue. Financially strained employees are more likely to commit fraud.


Employee morale refers to the attitude of workers—such as coming to work tired, acting depressed, or behaving bitterly. Both low and high morale is contagious. Employees working second jobs to cover personal expenses are often frustrated about how often they’re working. Helping employees relieve their financial worries allows them to better enjoy their jobs.

Employers that have loan repayment programs, such as student loan assistance, report higher morale among their employees. Employees are happy to come to work because they’re receiving a benefit that directly improves their financial status.

Physical Health

High stress levels result in weakened immune systems. Employees are stressing themselves out and making themselves sick. They’re either coming into work sick because they’ve used up their allotted time off or they’re taking unpaid sick days—both result in low productivity. Stressed out employees may also suffer from back pain, headaches, fatigue, and a number of other ailments attributed to high levels of stress that also interfere with job functions. While all employee stress cannot be alleviated by financial wellness, offering employees benefits to manage their personal finances will have a “healthy” return on investment.

The Solution to Financial Problems

The solution is not to pay employees more. It doesn’t hurt, but giving more money to the financial illiterate is the equivalent of giving more books to the reading illiterate. Somebody who has difficulty managing money will continue to mismanage even more money.

The solution is to help employees manage their personal finances through some form of financial wellness education, management, or contribution. Some benefits, such as student loan repayment assistance, push employees to take control of their debt because it makes the process simple and painless.

Providing financial wellness programs to help employees manage their finances will not only save money but reduce stress by helping employees meet their financial goals.