A third of millennials have been affected by money worries in the workplace, a distraction that can lead to difficulties in concentration, decision making and impaired performance, according to a survey of more than 1,800 UK employees by Close Brothers and the CIPD, the professional body for HR and people development.
This generation, those aged 18-34, were found to be the hardest hit out of any age group, as they attempt to juggle the double-edged sword of rising price inflation, low incomes – and in many cases large sums of student debt – while trying to save for the future.
18-24 year olds were also found to be the most likely to claim they face barriers in managing their financial situation, stated by seven in ten. The most common issue was they are earning just enough money to get by, stated by almost three in ten. This is even more prevalent in younger millennials, with 42% of those aged 18-24, and 46% of those earning less than £25,000.
Furthermore, the research found that while almost two thirds of 18-24 year olds value being able to save for the future as part of their overall financial wellbeing, one in four stated prioritising spending over saving is a barrier for them achieving it, as low entry-level incomes and significant living costs prevent regular contributions to a long term savings plan.
Despite the proportion of young people feeling the strain of managing their financial future, just 44% of UK businesses believe financial education is necessary at the start of their career, according to Close Brothers’ latest Business Barometer.
Jeanette Makings, Head of Financial Education, Close Brothers said: “Dealing with money worries is a huge burden, one that can have significant financial, emotional and physical implications. This is not limited to a just young people or people at lower wealth levels; worrying about money could affect any of us at any stage in our lives. For young people in particular, arguably the most financially-challenged demographic, who earn entry-level salaries while often saddled with debt, it can be an overwhelming ask to consider saving towards a pension or a property.
“Where employers can make a real difference is in providing financial education to young staff, giving them the tools, understanding and support they need at the point of entry, skills that can then apply to every financial decision for the rest of their lives. Many people are living under the misapprehension that young people are not engaged with saving for their future. This research dispels that notion with over two thirds stating a clear desire to save but not having the knowledge, confidence or wherewithal to do so.”
Charles Cotton, Pay and Reward Adviser at the CIPD, the professional body for HR and people development said: “It’s crucial that employers build the right environment for young employees to discuss financial questions through appropriate workplace channels. Young people may be more inclined to use external sources for advice, and not consider that their own workplace can be of help to them.
“By putting the right structures in place, and ensuring that young people feel comfortable using them, organisations can help improve the financial well-being of their younger staff.”