With the cost of living crisis and increasing fuel, energy and food prices, many people are struggling to get a hold of their financial situation. This has been confirmed by Mintago’s latest market research which has explored the link between mental health and financial wellbeing amongst a group of 1,024 UK adults.
The research revealed that the majority of UK adults claim that their finances are their most significant cause of stress, with concerns heightened by the cost of living crisis, inflation and the rising costs of energy and food. 60% of those who claimed this were 18-34 years old, with this suggesting that younger people are struggling to cope in the current climate, with many unable to live a comfortable lifestyle and afford essentials.
Financial worries cause significant stress and loss of productivity amongst UK adults. 32% of respondents stated that they struggle with day-to-day tasks, whilst 43% have lost sleep over financial concerns. This loss of productivity transfers to the workplace, affecting employees’ ability to concentrate on their tasks and perhaps causing a knock-on effect for other departments within a business. Employees may have to take time off of work to recover from stress-related illness, further reducing overall workplace productivity and disrupting team consistency.
49% of UK adults have said that their monthly outgoings have at least doubled since the beginning of 2022. Similar statistics were revealed for each age group surveyed, suggesting that all age demographics have been affected in some way by the fallout caused by the pandemic and the cost of living crisis.
For those approaching retirement, financial concerns have certainly not disappeared. 62% of UK adults surveyed expressed that their financial situation has deteriorated since the beginning of 2022. This means that in a period of just over 6 months, many people have noticed a significant change in their outgoings, with this causing stress. 57% of those responding belonged to the 55-plus age bracket. This suggests that individuals of this age are struggling to manage their finances effectively approaching retirement, meaning that they may not achieve their desired retirement lifestyle.
Worryingly, 22% of those responding to the survey confirmed that they have temporarily paused their workplace pension contributions because they need to use the money for immediate financial commitments. 27% of those who have paused contributions belong to the 18-34 age bracket. If young people pause pension contributions for a considerable amount of time, they may not have saved enough upon retirement to reach their goals, also losing out on employer contributions. Furthermore, they may have to pay more into their pension fund each month upon resuming payments to ensure that they are back on track to achieve retirement goals. This may cause unnecessary stress and some individuals may not be able to afford the larger contributions necessary.
Mintago’s research has revealed that 77% of UK adults surveyed worry that they will not be able to retire at all. Only 32% of those aged 55 plus were confident in their ability to retire. This is concerning because of the indication that many individuals approaching retirement will not be able to afford the lifestyle that they desire. It is unlikely that most people will be able to comfortably rely solely on their state pension.
Supporting employee financial wellbeing
In conclusion, it is extremely important that employers take the financial wellbeing of their employees seriously, especially at a time when many people are struggling to maintain their lifestyle due to wages not increasing despite inflation. By taking steps to support their team, employers can ensure that employees feel valued and that stress is kept to a minimum, resulting in consistent productivity and business success.