By Ray Law, Co-Founder of moneyappi, a workplace financial wellbeing smart-tech solution.
Once considered a personal matter, employee personal finances are now a serious business risk.
Nearly one in two UK workers live paycheque to paycheque. For many, a single unexpected expense like a car repair or missed childcare payment, can throw their finances into chaos. The stress and anxiety that follow don’t stay at home; they come to work too. In fact, financially stressed employees are 4.5 times more likely to feel their stress affects their ability to perform on the job, according to PwC’s 2023 Employee Financial Wellness Survey.
This is no longer just an HR issue. It’s an operational risk that affects productivity, retention, and even security. Business leaders can’t afford to ignore the financial fragility and brewing financial anxiety of their workforce.
Financial stress is bleeding into business performance
The numbers are sobering. Research from Champion Health shows financial pressure is the leading cause of stress outside of work, cited by 37% of UK employees. Meanwhile, a report from the Financial Wellbeing Index found that employees with money worries lose an average of 6.9 hours of productive time per week. Across a 500-person business, that’s the equivalent of 43 lost working days per week, or over £1 million annually in productivity costs.
Poor financial resilience is also linked to increased absenteeism, presenteeism, and long-term sickness. According to the CIPD, 43% of employees who report poor financial wellbeing say it affects their ability to do their job. For line managers, this means more performance conversations, higher levels of team burnout, and mounting pressure on HR.
And in some sectors, financial fragility can have even more serious implications. Internal fraud, theft, and data leaks are more likely to occur when staff are under acute financial stress. A survey by Cifas, the UK’s fraud prevention service, found that one in five internal fraud cases is linked to personal financial difficulty.
This isn’t an isolated issue. It’s a systemic risk that crosses industries, roles, and income levels.
Pay rises aren’t solving the problem
For many employers, the go-to solution is still pay: higher salaries, one-off bonuses or cost-of-living uplifts. While these may offer temporary relief, they rarely address the underlying issue: low financial resilience.
Why? Because financial wellbeing isn’t just about how much people earn. It’s about how they manage their money, how secure they feel, and whether they can cope with unexpected financial shocks. Without confidence, knowledge and habits in place, more money often leads to more spending, not more stability.
It’s about helping people feel safe, seen, and in control of their money again. Holistically and empirically.
Data from the ONS shows that even households in the top income quintile are struggling with credit card debt and financial anxiety. Meanwhile, 40% of UK adults don’t feel confident managing their money, and millions aren’t saving regularly despite earning above the national average.
Financial resilience is not an income issue. It’s a knowledge, skills and behaviour issue. And that’s why employers need to think beyond the payslip.
Financial resilience can be built and must be embedded
The good news is that financial resilience can be built. Like physical or mental health, it requires education, consistency, and support.
Forward-thinking employers are starting to take a more structured approach. Financial resilience programmes (when done right) can improve literacy, shift behaviours, and make traditional benefits more meaningful. For example, a workplace pension is only valuable if an employee can afford to contribute. A discount platform is only helpful if the employee isn’t relying on credit to cover the basics.
The key is to embed financial resilience into the culture, not just bolt on a budgeting webinar during Financial Wellbeing Week. This means meeting people where they are, using smart-tech to deliver personalised, relevant support: coaching, signposting, and guidance – in a way that’s accessible to everyone, at scale.
Importantly, these interventions need to feel personal. A 25-year-old renting in a city centre needs different support than a 45-year-old juggling mortgage payments and school fees. Generic financial education often misses the mark. Tailored, tech-enabled tools make the message stick.
And the return on investment is clear. The Financial Capability Lab has found that simple behavioural interventions, like goal setting and spending nudges, can significantly increase saving rates and reduce financial stress. Businesses that invest in financial wellbeing often see improvements in morale, retention, and performance.
Financial wellbeing is the new frontline in risk management
In a world of economic uncertainty, tight labour markets, and rising household costs, financial fragility among employees isn’t going away anytime soon. But ignoring it is no longer an option.
Just as businesses now take mental health seriously, financial wellbeing needs to become a core part of workforce planning and risk mitigation. Employers that help their people become more financially resilient are better positioned to build strong, sustainable teams, and protect themselves from the silent risks that come with financial stress.
Financial resilience is not just a nice-to-have employee benefit. It’s a critical lever for organisational resilience. The businesses that recognise this will be the ones that thrive.
