Finances have been at the centre of conversation in the past few years, inflation and the cost-of-living crisis taking space at the forefront of consumers’ minds. Even those traditionally more financially secure are feeling the strain, with financial pressures mounting and maintaining stability becoming increasingly challenging. Finances play a vital role in our overall wellbeing, and with more and more consumers experiencing changes in this area, there is ample opportunity for brands and consumers to act
To understand how significant finances are when it comes to overall wellbeing, it is essential to note that finances underpin all aspects of wellbeing. Our hierarchy of needs almost entirely depends on our finances and any risk to this can have adverse impacts on both mental and physical health. For instance, from a physical health perspective money is needed to fund exercise (e.g. gym memberships, exercise equipment, sports clubs) and balanced, nutritious diets, while from a mental health lens we need money to engage in things that boost our serotonin and continuous positive mindsets (e.g. social time with friends, counselling, treat items). When investing in ourselves becomes less feasible, this can quickly cause our wellbeing to decline.
“Wellbeing to me is when I can afford the things I like, I can go on holiday when I want to, I can afford food. I haven’t been able to afford as much in recent months, and it's made a huge difference” – Financial wellbeing study participant, Female 55-64
Having financial autonomy is a key aspect of financial wellbeing as it provides safety, freedom and peace of mind. Possessing the funds to cover what is needed in the here and now gives security, further compounded with a sense of freedom at having the essentials covered and still having disposable cash left over to do with as we please. Being able to make large and small life decisions at ease is a considerable privilege, one that consumers are becoming more acutely aware of. On the other side of this, those without financial autonomy feel far more at risk. Not knowing whether they will be able to cover essential costs, let alone invest in themselves manifests feelings of uncertainty and isolation.
“Having control over my finances meant I could feasibly take a career break and focus on my education” – Financial wellbeing study participant, Male 35-44
Throughout our financial wellbeing deep-dive, the importance of supporting consumers in improving their finances became increasingly apparent. Consumers tend to put the onus on themselves when it comes to their financial situations and are often reluctant to speak up and ask for help due to the stigma around speaking about money in social settings. There is also a distinct lack of awareness of where resources and information are available, particularly amongst those who are less financially minded.
Now more than ever, financial brands and beyond can build a real connection of trust with consumers by leading the way in helping them better understand their finances, improve their situations, and empower them to take control.
There is a huge amount of information on financial products and services available, as well as huge news coverage of the changing economic landscape. While this is true, the sheer volume can feel daunting and is usually catering to consumers who are already fairly financially savvy. Those who are less confident in their financial knowledge are put off by the often-confusing language used across financially focused documentation and are frequently finding themselves back at square one in not knowing where to turn.
There is clear opportunity to make financial support and advice readily available to all, by clearly indicating via comms where to find information. To ensure this is accessible to all knowledge levels, language used must be in simple terms and easily digestible.
“I think I’m only clued up on money stuff because I’ve got a financial brain, generally speaking, financial literacy is low in the UK – information should be easy for everyone to find and understand” – Financial wellbeing study participant, Male 35-44
Despite consumers being acutely aware of their finances, currently there is a lack of understanding in the role finances play in our overall wellbeing. When asked what wellbeing means to us, we typically think of physical and mental health. More can be done by brands to support consumers in making the link between financial wellbeing and overall wellbeing, in turn raising awareness around the barriers to building positive financial situations.
While financial providers are best placed to spread knowledge on financial matters, there is scope for all sectors to consider how they can best equip consumers with the relevant information needed to maintain financial wellbeing.
“Brands need to be empathetic to every situation, a human approach to sharing knowledge is the best way forward” – Financial wellbeing study participant, Female 55-64
Not being particularly financially-savvy and facing financial issues can be an extremely overwhelming place for consumers and often have them thinking they can’t improve their situations on their own. This can lead to many not asking for help and worsening their financial wellbeing. To caveat this, brands should empower consumers by spreading the word that is it okay to not be as clued up as others, and there is help available to anyone who needs it, regardless of their own financial knowledge. Brands can tailor financial information to the individual and reach out directly, covering areas that would be most relevant to them.
“You need individual needs and circumstances taken into account, and an organisation that doesn’t just want to exploit you” – Financial wellbeing study participant, Male 55-64
“Support isn’t always targeted at people who are less interested in finances, but they’re the ones who need the most help” – Financial wellbeing study participant, Male 35-44
The role of financial wellbeing in overall health cannot be overstated. As consumers face increasing financial pressures, the opportunity for brands to step in and make a meaningful impact is greater than ever. By offering accessible advice, incentivising financial literacy, and challenging perceptions around financial knowledge, brands can forge stronger connections with their consumers. These efforts not only help consumers take control of their financial futures but also enhance their overall wellbeing. Brands can be part of creating a financially empowered and healthier society.
If you’d like to learn more about this topic and hear about LV= initiatives aimed at supporting financial wellbeing for their customers, watch our recent webinar recording here.
Beth Bleathman
Reading Time: < 1 minute
Reading Time: < 1 minute Recently, we hosted an inspiring in-person event in Leeds, where senior insight and marketing professionals gathered to delve into the concept of customer-centricity. In this blog, we distill some of the key messages and profound revelations that emerged from the exchanges between our speakers and the audience.
