Cost of living crisis: Tips to boost your financial wellbeing

As the UK grapples with the cost of living crisis, rising energy bills and higher food prices, looking after our financial wellbeing has never been more important. 

Elevate is teaming up with Claro Wellbeing to provide financial wellbeing training – helping everyone within your organisation lead a healthier financial life.

Financial stress has a huge impact on workers’ mental and physical health. And that’s true for everyone from new graduates to senior management. In fact, some 67% of staff say money worries impact their work. Many employees are taking more sick days and actively looking for higher-paying jobs.

However, the need to support staff financial health isn’t just linked to the cost of living crisis. There’s a chronic lack of financial education in schools. And this means many people enter adulthood without the skills and confidence to manage their money effectively.

The results are constant job hopping, sickness absence and poor productivity at work. All of us need better tools to make smarter financial decisions!

The team at Claro Wellbeing has built up expertise by working with a community of 45,000 users. They’ve created a range of services that boost employees’ financial skills and confidence:

• Bespoke one-to-one financial coaching sessions for staff achieve at every life stage
• On-demand learning and development courses covering essential personal finance topics
• Tailored team webinars and workshops
• And a powerful budgeting tool

We caught up with Stacey Lowman – financial wellbeing coach at Claro – to find out how she thinks people can best support their financial wellbeing and combat the challenges of the current cost of living crisis.

What is financial wellbeing in a sentence?

“A state of Being reflecting a person’s ability to meet current and ongoing financial obligations, feel secure in their financial future, and make choices that allow enjoyment of life.” (US Consumer Financial Bureau)

I like this definition, because it breaks quite an abstract idea down into themes you can see in everyday life: 

• Current security
• Future security
• Current freedom of choice
• And future freedom of choice

Start taking action by honing in on one of these areas of your finances first.

What’s the one thing everyone should be doing to prioritise their financial wellbeing?

We each have our own financial worries and priorities, but I would say the one thing we can all do is to commit a small window of time each week for our finances. 

That might be 30 minutes one lunchtime, during your commute, over weekend breakfast with your partner, or a call one evening with a friend. Add the meeting to your diary. Then think about what accountability or rewards you can put in place to stick at it to make it a habit. And use the time in whatever way you think will help you to feel better about your finances. Read over your bank statement, check your subscriptions, think about future goals, check your pension, learn about investing, or journal about your money worries. How you spend the time is up to you. But slowly you will feel more confident looking at your own financial situation. And you’ll build your knowledge and confidence over time.

What’s the number one mistake people make when it comes to money?

Everyone makes ‘mistakes’ with money, partly because most of us aren’t taught how to manage it! So we learn through experience and hard life lessons. There’s no shame in that. It’s rarely a smooth journey for anyone, so know that mistakes are inevitable. 

The one thing you should try not to do is nothing at all. 

Burying your head in the sand is very tempting, especially if you feel overwhelmed, unqualified, or embarrassed about your financial situation. But you can only overcome hurdles by facing your fears and taking ownership of how you want to engage with your money from now on. And there’s support out there so you don’t need to do it alone.

What are the biggest wellbeing risks if we don’t manage our money well?

We all know that money doesn’t bring us happiness. But many of life’s challenges might be easier to cope with if you have money as a resource to help you through. For example, an emergency fund if you lose your job, insurance if you fall ill, or savings to help family or friends in need. 

But money is more than just a reassuring resource in hard times. Money is with you throughout your life and it impacts most of your life experiences. Your physical health, mental health, relationships, career trajectory, decisions about where we live, if and when to have children, and how successful you feel – they’re all influenced by finances. 

You might carry lots of money shame and stress, which can keep you stuck in situations that harm your wellbeing. Money shouldn’t be prioritised over the enjoyment of life. But better money management gives you –  and the people you care about – more choices, security and freedom.

In 2023 things are feeling much harder for many of us because of the cost of living crisis – what are the three things we can do today to feel more financially healthy?

1. Get clear on your current situation. Know how much money you earn. How much you have and where it is. And how much you spend, save and invest each month. This gives you the data you need to make informed decisions about your next steps.
2. Focus on what you can control and celebrate your progress. The uncertainty and volatility out there at the moment can be overwhelming. And if your budget isn’t stretching as far as it used to, you might feel like you’re failing in some way. Identify small steps within your control and celebrate every small win. Build momentum from there. Examples might be finding a savings account with a higher interest rate, reducing your weekly food shop by £20, or reducing your energy use.

Be intentional about where you get support. There is lots of noise out there, and many sources of financial information and advice, with varying degrees of credibility! Write down which areas of your finances you need support with and specific questions you want answered, and speak to trusted sources about the most appropriate places to get the help you need. You don’t need to manage your money alone.

Join Elevate and Claro for a FREE webinar ‘How to Navigate the Cost of Living Crisis’ on Thursday 16th February 2023 at midday. You can sign up here.