How to reduce financial stress for young employees from the moment they’re hired
The first few weeks of a new job are often filled with a mix of excitement and uncertainty. For many young employees, they also come with a significant source of financial stress: debts, managing a budget, and navigating a group plan that is not always well understood.
Financial stress does not begin when employees start a new job. It’s part of the reality in which Gen Z is coming of age.
Yet, a new job can be a strategic turning point. With the right support from the start, young adults can build strong financial foundations. And employers stand to benefit through improved employee engagement and retention.
So how can this anxiety be reduced during those crucial first days? Often, it comes down to guidance and clarity. It’s also important to choose the right time to share information and introduce the resources available.
Why are young employees experiencing so much financial stress?
Carefree youth? Not quite. As Gen Z enters the workforce, they face a demanding reality: housing, groceries, fuel and other essential expenses can consume up to 50% of their income. It's no wonder that many live paycheque to paycheque.
Early in one's career, jobs are usually temporary or part-time and typically come with fewer benefits. In an increasingly uncertain economy, youth unemployment also remains higher than average, making financial stability more difficult to achieve.
Adding to these very real challenges is another, less visible but equally influential factor: social media pressure. Images of success, travel and the “ideal” lifestyle can make it seem as though everyone else is doing better. This can only add to the feeling of falling behind.
There is also a lack of financial literacy. Without a solid understanding of credit, debt and saving, many young people move forward through trial and error, or postpone important financial decisions altogether.
What are the effects of financial stress?
According to Dr. Denis, family physician and medical advisor at Beneva, financial stress often acts as a trigger. Among young employees, it can quickly lead to anxiety, disrupted sleep and persistent fatigue. Over time, these effects reduce concentration, hinder performance and make daily life more difficult.
When health begins to suffer, managing finances becomes even more challenging. Decisions become more impulsive. Some people delay receiving care. Workplace motivation can also decline. For SMEs, the consequences are tangible: exhausted teams, increased turnover and rising disability claims. It’s a cycle that can quickly set in... and become difficult to break.
Getting more value from your group benefits plan
From the moment employees are hired, your group insurance plan can become a practical tool for reducing financial stress, provided employees understand it.
Beyond outlining the available options, it’s essential to clearly explain how the plan works and what costs are involved: the portion paid by the employer, the employee contribution, and any additional premiums associated with the selected coverage. Without this information, it can be difficult for younger employees to make informed decisions.
Don’t overlook the full range of benefits available under your group plan. Present them in a simple way so they become useful tools rather than just items on a checklist.
A short orientation session, supported by accessible intranet resources and well-timed reminders throughout the first few weeks, can help transform information into practical knowledge.
The Employee Assistance Program: an underused resource
Despite its value, the Employee Assistance Program (EAP) remains unfamiliar to many young workers. Many don’t realize it can provide support for a wide range of concerns, including financial anxiety, stress, personal relationships and workplace challenges.
Confidentiality can also create concerns. Some employees worry that their employer will be informed if they seek support. By clearly explaining the services available and the privacy protections in place from the outset, employers can eliminate these concerns and encourage early use of the EAP, which is often more effective than waiting until issues become more serious.
Care from home... or almost
Telemedicine also offers easier access to healthcare, aligning well with the digital habits of younger employees. Many are unaware that they can quickly consult healthcare professionals without leaving home, or wherever they happen to be. Whether they have a health question, a minor issue or simply need guidance, virtual care makes it possible to receive support promptly, without the delays or inconvenience associated with in-person appointments.
By explaining how the service works during onboarding and reminding employees about it over time, employers can encourage greater use of a service that simplifies and accelerates access to care.
When it comes to finances, the first 90 days matter most
Often overlooked, financial onboarding remains an underused opportunity. It consists of providing new hires with a simple, progressive roadmap that helps them understand key topics such as a group insurance plan, employee benefits, savings tools, budget basics, etc. The goal is to provide clear guidance without overwhelming new employees.
The first few months are critical. Within 30 to 90 days, habits begin to form and can have a lasting influence on people’s relationship with money. This is the ideal time to encourage healthy financial behaviours before poor habits take root.
Your role matters. Making resources visible, easy to understand and simple to access is only part of the solution. They must also be introduced at the right time and in a practical, meaningful way. This accessibility is what helps employees develop positive habits.
Finding the right tone
Young employees don’t have the same priorities or frame of reference as people approaching retirement.
To capture their attention, communications should reflect their reality: balancing work and studies, taking on financial responsibilities for the first time, supporting mental health, accessing services quickly and striving for work-life balance.
Messages that are overly institutional or focused primarily on retirement planning are likely to be overlooked. Concrete examples, straightforward language and tangible benefits help demonstrate the value of the support available.
The format is just as important as the message. A two-hour lecture is unlikely to have the same impact as an interactive webinar, a short video or a series of resources that employees can access when they need them. To foster engagement, employers must reach young people where they already are, using the platforms and formats they prefer. The easier information is to access, understand and apply, the more likely it is to be remembered and used.
A win-win situation!
Helping employees better understand their group benefits from the moment they are hired benefits both young workers and employers. For example, nearly half of all new long-term disability claims among individuals aged 18 to 35 are related to mental health conditions.
When your young employees understand the resources available to them and use them early, they’re better equipped to manage financial stress and health-related challenges. Employers benefit too. Financial stress negatively affects the performance of more than half of Canadian workers and can lead to lower productivity, absenteeism and employee turnover.
Make hiring a pivotal moment
The first weeks of employment offer a unique opportunity to showcase the value of your group benefits plan. By presenting benefits in engaging formats, using real-life examples and sharing timely reminders, employers can turn often-overlooked advantages into genuinely valuable resources. It’s also a meaningful way to demonstrate that employee well-being matters from day one.
Give it some more thought
Consult our health trends report, Connecting the Dots. It contains a wealth of valuable information:
- Young adults
- Mid-career adults
- Pre-retirees
- Critical illness