Our annual guide to helping employees head into the new year with less financial stress
GO with Eckler: Engaging insights about financial wellness in the workplace
As we write this first edition of the new year, many of us are embracing opportunities for the year ahead and doing our best to stay true to resolutions – including getting a better handle on finances. Unfortunately, the start of the new year is also the time when many Canadians are dealing with significant financial stress. Whether it’s because they are overwhelmed by post-holiday bills, less take-home pay as CPP and EI contributions start anew or simply continued pressure from the challenges of the past year, Canadians are stressed about money. In fact, according to the 2024 Financial Stress Index, money as the top stressor for Canadians has been steadily increasing since 2022.
Managing money and debt is hard and even harder when your money doesn’t go as far. For many, increased housing costs, spending more for food and gas and other necessities means they’re either borrowing to make ends meet or simply not saving. According to the Financial Consumer Agency of Canada’s recent dashboard on financial wellbeing, almost half of Canadian households used savings to cope with current economic conditions and more than 40% of households with debt, said their debt has increased.
The good news is Canadians want help. More are seeking advice from financial planners and are embracing financial wellness initiatives offered in the workplace.
As we head into the new year, here is our annual guide for helping employees cope with financial stress and start the year with a plan to help manage their money and debt. Consider how you can provide access to help with these key learning basics:
- 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.).
- 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.
- Goal setting: Setting short-term and long-term goals is critical to getting and staying motivated enough to stick with a financial plan. Encourage employees to set 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 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.
To find out more, contact our financial wellness team.
