Key takeaways
- Financial health is a critical pillar of a holistic wellbeing strategy that directly impacts employee mental and physical health
- In Australia, 88 per cent of workers experiencing moderate or severe financial stress report that their finances affect their productivity at work
- A whole-person approach recognises that financial, mental and physical health challenges are interconnected, not isolated issues
- Employers who address financial stress as part of a comprehensive wellbeing strategy can reduce costs associated with absenteeism and presenteeism, which total approximately AU$10 billion annually
- Bundled wellbeing solutions that support financial, mental and physical health create stronger outcomes than standalone programs
Exploring the interconnected elements of health
Part three: Financial health plays a key role in employee engagement
Read part one of our holistic health series: The case for employee mental health support
Read part two of our holistic health series: The physical health advantage
Australian workplaces report some of the highest stress levels in the world. This has triggered a discussion around the essential role employers can play in relieving workplace stress. In fact, 91 per cent of employees in Australia believe that mental health in the workplace is important.
However, mental and emotional wellbeing go deeper than mental health support alone. A huge part of financial and emotional wellbeing is the feeling of economic stability and security. Financial health can impact everything from an individual's self-esteem to their ability to get a good night's sleep.
One study found that 56 per cent Australians believe financial health is a factor in their overall health, while six in 10 are thinking more about their financial outlook than they did a year ago. Respondents recognised the link between mental, physical and financial health, with 58 per cent saying their financial health impacts their mental wellbeing and 47 per cent indicating it impacts their physical wellbeing. Nearly all Australians (90 per cent) with poor financial health said that financial stress negatively impacts their mental wellbeing.
This interconnection between health dimensions forms the foundation of a holistic wellbeing strategy—an integrated approach where financial, mental and physical health are treated as linked rather than isolated concerns.
Here’s a closer look at financial health, and how it intersects with other elements of health to impact employee engagement, productivity and performance.
What does financial health really mean?
Financial health refers to a person's financial state over time, from short-term daily financial obligations and resilience against shocks to the ability to reach long-term goals and feel secure and in control of their finances.
Yet 66 per cent of Australians feel financially stressed, and 70 per cent believe that health and mental wellbeing are among the aspects of life that good financial wellbeing impacts most.
According to the Q1 2026 TELUS Mental Health Index (MHI), 31 per cent of Australian workers don't have emergency savings to cover basic needs. This lack of financial security creates ongoing stress that ripples through every aspect of their lives.
The connection between financial and mental health
When financial health is lacking, it can further affect the mental health and wellbeing of employees, and Australians agree: most (56 per cent) believe their financial health is a factor in their overall health. Additionally, the MHI shows that 44 per cent of workers say financial concerns are a source of personal stress (March 2025).
Financial insecurity and money-related worries are also significant drivers of declining mental health in the workplace. Workers in Australia who rate their employer’s financial wellbeing support as poor have a mental health score that’s nearly 19 points lower than those reporting excellent support (September 2025).
This stark contrast underscores why financial wellbeing is a critical factor in mental health and broader overall wellbeing. Holistically healthy employees are more likely to feel productive (88 per cent), engaged (87 per cent), resilient (83 per cent) and satisfied in their current job (82 per cent) — and 80 per cent of these holistically healthy employees are more likely to remain in the same job one year later.
The connection between financial and physical health
Financial stress is associated with high-risk behaviours and impaired decision-making. Worrying about money can negatively affect everyday decisions. And while some decisions we make under stress have minor consequences, others may lead to poor physical health or even injury.
All kinds of stress can manifest in physical ways, including financial stress. Body aches, exhaustion, insomnia and muscle tension, as well as more serious physical health conditions can often be linked to financial stress.
In a holistic wellbeing strategy, employers recognise that supporting an employee's financial security can have positive flow-on effects for their physical health and overall resilience.
How financial health can affect employee engagement
A lack of financial health isn't just a burden; it's a distraction. In fact, 88 per cent of Australians who experience moderate or severe financial stress say their finances affect their productivity at work.
These financial stressors take a significant toll, costing the Australian economy an estimated AU$15 billion annually, with another AU$10 billion each year in direct costs to employers caused by absenteeism and presenteeism.
Naturally, efforts to reduce this stress can help improve employee engagement. Financially secure employees are more likely to stay focused, motivated and engaged in their work, leading to increased productivity and better job performance. According to the TELUS Mental Health Barometer, 32 per cent of workers in Australia say their mental health is negatively impacting their work productivity. By addressing financial stress as part of a broader, integrated wellbeing program, these productivity losses decrease.
When Australians consider joining a new organisation, the most popular primary considerations for them are remuneration, rewards and benefits. This signals that employers who invest in financial wellbeing programs as part of broader employee benefits are more likely to attract and retain talent.
Facilitating improved financial wellness for the workforce
Analysing six decades of data, one study noted that better pay consistently predicted higher rates of employee health and wellbeing. It also led to better outcomes for organisational performance over time due to decreased absenteeism and turnover..
However, salary increases aren't the only way for employers to help employees feel financially healthy and secure. A holistic workplace wellbeing strategy extends beyond compensation to include bundled support services that help address multiple health dimensions simultaneously.
Employee assistance programs (EAP) can include financial counselling, financial education and support. Employers that offer access to professional financial advisors can provide proactive, tailored guidance to their team, helping them navigate their specific financial situation, plan for retirement and reduce anxiety around money.
By providing a whole-person wellbeing approach, organisations can tailor support to employee needs as part of a financial wellness strategy, helping create workforces that are genuinely resilient, engaged and capable of thriving in today's high-pressure environment.
Dive deeper into the holistic health of your employees
Learn how mental, physical and financial health are interconnected aspects of wellbeing, and how they affect the performance of employees and organisations alike.
Download the eBookFrequently asked questions
How does financial health fit into a broader holistic wellbeing strategy?
Financial health is one of three interconnected pillars of wellbeing, alongside mental and physical health. A holistic wellbeing strategy recognises that financial stress directly impacts mental health and physical wellbeing. Rather than treating these issues separately, a whole-person approach bundles support services so employees receive integrated care that addresses root causes, not just symptoms. This can lead to better engagement, productivity and retention outcomes.
What's the difference between a traditional EAP and a holistic wellbeing strategy?
A traditional EAP typically focuses on mental health and counselling support. A holistic wellbeing strategy is broader and more integrated, addressing mental, physical and financial health as interconnected elements across wellness programs, work-life needs and workplace culture. It often combines EAP services with financial literacy programs and preventative wellness initiatives to help support the whole person.
What's the first step an organisation should take to adopt a whole-person wellbeing approach?
Start by assessing your current state. Conduct a baseline survey to understand your workforce's wellbeing challenges across all three dimensions (financial, mental and physical), and use focus groups to gather deeper insight. Analyse absenteeism and turnover trends. Then, identify where financial stress is driving other health issues and identify areas that need targeted support. Once you understand the interconnections, you can design bundled interventions that can help address root causes rather than symptoms alone. Many companies and HR leaders use these strategies to improve engagement early in the process.You can also use our Mental Health Index reports to see overall trends, industry benchmarks and see how your organisation compares.
How do you drive employee engagement and adoption for a new holistic wellness strategy?
Effective employee engagement strategies start with managing employee engagement through clear communication. Twenty-nine per cent of workers in Australia say their employer doesn’t offer an EAP and another 22 percent are unsure, so it’s important to not assume employees are aware of what's available (September 2025). Promote wellbeing resources regularly across multiple channels. Train managers to have supportive conversations about financial stress and wellbeing. Make resources easy to access and emphasise how financial support connects to overall health and job satisfaction. Finally, measure and celebrate early wins to build momentum and trust.
Can a holistic wellbeing strategy effectively support remote and hybrid teams?
Yes, but with intentionality. Ensure your financial counselling, mental health resources and physical health programs are all accessible digitally through the tools employees use to stay connected and supported. Create virtual spaces for employees to connect and reduce isolation. Train managers to have regular wellbeing check-ins with remote and hybrid team members. Communicate clearly about what support is available, since remote workers may feel less connected to workplace resources. A digital-first approach combined with personalised manager outreach works well for distributed teams.
