According to the Commission for Financial Capability, around 21 per cent of the Kiwi population are in the financial equivalent to “intensive care” – unable to pay back loans, save for a deposit or even plan for retirement, many members of the group never get out of the red.
It’s a precarious situation which, unsurprisingly, takes its toll and soon spills into the workplace – research by financial education provider Finance Finesse revealed that 83 per cent of employees report at least some financial stress and 16 per cent say it’s high or overwhelming.
“This stress imposes significant costs on both the employees and their employers,” says financial planner Erik Carter, pointing to a U.S study conducted in 2010 which estimated that financial stress costs an average of US$5k per employee per year in lost productivity.
HR director Michaela Connor says it’s a cost that companies just don’t have to incur - the Auckland-based leader heads up the HR department for Flight Centre, where employees can access free financial advice.
“We have financial advisors that will come out and see our people and help them save for a house or they sit down and they plan with them what they need to do in a financial situation,” she told HRM.
“Employees don’t have to pay for that, that’s part of the service, that’s part of being an employee at Flight Centre.”
Connor says the company established its own internal business, Moneywise, to serve the Flight Centre workfroce - combatting stress and providing a lifeline to workers who may be feeling overwhelmed.
“We’re all busy, we don’t really sit down and think about it, everything kind of snowballs sometimes,” she admits. “When someone else – a professional – comes in and sees you, they can just sit down and have a look at it with you and have a look at realistic goals – that’s what they do.”
The company also helps employees and their families find the best home loans for their individual situation so they don’t have to compare the different banks themselves.
“If you and your partner want to save for a house, MoneyWise will sit down with both of you so they’re helping you as a family get to where you need to be,” she says.
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A worrying new report has revealed that Kiwis have more than $15 billion of debt and at least a fifth of the population are in dire financial straits – but is it really anything to do with HR? Well, if an overwhelming array of statistics are to be believed, yes.