Employee mental and financial health: why EAPs matter

Rising costs, fueled by inflation, are putting pressure on employees and increasing their debt. The situation feels overwhelming for many, and employees are often open to any support offered by employers. In fact, in the February 2023 TELUS Mental Health Index (MHI), 36% of U.S. workers indicated automatic savings/investment plans would be valuable if offered by their employer. Further insights are noted in the newest edition of the MHI, released in October.

“During the most recent survey, when asked about the most important thing employees wanted in a benefits plan, 34% of workers said financial planning is most critical,” says Paula Allen, Global Leader for Research and Client Insights at TELUS Health.

TELUS Health is a relatively new name to some American employers, but it banks on more than 50 years of U.S.- based experience in the Employee Assistance Program (EAP) space, as well as a strong long-term position in Health and Welfare Administration. Through its acquisition of LifeWorks in September 2022, TELUS Health has become a global healthcare leader serving people in more than 160 countries, including the United States.

The most recent edition of the MHI found a close connection between employees’ health and their finances: one in four U.S. workers worry about their ability to retire, while more than half (63%) of workers don’t know how much savings they need to retire, citing inflation as a leading concern.

It also found that 22% of workers are spending 50% to 70% of their income on basic needs, with 11% admitting they’re concerned about covering those fundamental expenses.

This data underscores the growing need for employers and employees to leverage the training and financial consultation services offered through EAPs to help manage financial issues with practical guidance, and deal with stress those issues bring.

“We have these three pillars – mental, physical and financial health, each impacting the other – and research shows a strong link between financial and mental wellbeing,” says Allen.

On a scale of 0-100, workers without emergency savings have a mental health score of 52.4, more than 15 points below the national average, according to TELUS Health. Workers with emergency savings, however, score significantly higher at 76.

How EAPs support employees’ financial health

Strong EAPs can offer financial wellbeing tools. Additionally, health benefit plans can also provide health savings accounts, flexible spending accounts and other spending account services. Employer-funded programs can often include legal resources within an EAP, and specialized programs like disaster and hardship employee relief funds.

“Offering EAPs is an opportunity for employers to be helpful in areas that are a concern for employees, particularly right now,” Allen says. “And if you help people during bad times, they will never forget it.”

The role of managers is critical in recognizing employee needs and proactively directing them to the appropriate tools and resources, such as EAPs.

“When an employee’s behavior is out of sorts or changes in some way, managers may not know the reason, but they can show concern and provide information about the company’s EAP which can help address a range of issues,” says Allen. “Training managers to have these conversations promotes a culture of wellbeing in all respects of physical, mental and financial health.”

By prioritizing and leveraging EAP resources that align with employees’ immediate concerns, employers can provide their workforce with better support and help them feel valued and understood.

Nicki Howell is a freelance writer with over a decade of experience writing about benefits, insurance, and technology trends.

TELUS Health (formally LifeWorks) is a global leader now serving people in more than 160 countries, delivering digital innovation and clinical services to improve total physical, mental and financial health and wellbeing across primary and preventive care. For more information, please visit: www.telushealth.com.

Check out additional resources from this series including other mental health articles.