"People would rather tell us anything about their sex life or infidelity than talk about their money and personal finances." A sentence that sounds like a hackneyed folk wisdom at first listen. In fact, it is one of the main findings of a 1999 scientific article by the American psychiatrist Richard Trachtman aptly titled the Money Taboo.
In it, Trachtman deals with how the communication block in relation to the topic of money affects not only people's everyday lives, but can also become a frequent cause of deeper psychological problems and the inability of patients to move in the right direction during therapies. Simply put, money can affect our mental health more than we ever imagined.
Call it financial silence. We can talk about money perhaps with a partner and a close family (although even here the topic is often very narrow – let's remember all those cases of secret debts of huge proportions that dragged the whole family to the bottom and which could have been solved if their authors had been able to admit the color in time), perhaps with a best friend, but that is basically the end of the list.
According to Advanto's 2020 research on Czech employees by EMA Data, 70% of people expect financial assistance and support from their employer in case of financial problems or just discomfort, but never ask for it. Employees are not willing to express even a slight dissatisfaction, and in the case of a better financial offer, they leave without warning to work for a competitor. Their bosses often do not know the real reason for leaving.
Money is a topic that should definitely be talked about in Czech companies. "According to our own surveys and the studies we have, almost 50% of employees have trouble making ends meet during the month. This is not just about low-income groups, as it might seem at first glance. People with above-average incomes also commonly face this situation," Martin Fortelný, founder and CEO of Advanta, describes the situation on the Czech labour market. It points to another typical phenomenon of so-called payday millionaires. "Employees don't create savings and spend 80% of their paycheck in the first 7 days. This necessarily leads to a routinely recurring merry-go-round, when people have to tighten their belts for most of the month, and any unexpected expense of more than CZK 10,000 can endanger them, force them to use a disadvantageous and dangerous loan and open a quick path to the debt trap," Fortelný describes.
How to get out of it? Gerhard Knop, longtime CEO of Witte Automotive, senior executive and founder of the Leadership Synergy Community, says that setting up a level of trust between managers and employees that people will be willing to talk to you about their financial problems and situations is essential to the healthy functioning of the business. "You don't need any special methodology or a management course for that. Talk to people. Ask them the same thing over and over again. What they need, what bothers them, what pleases them and what they expect. Tell them you're there for them and create a safe environment."
Today, all free companies operate on the principle of trust and open dialogue. "We can be inspired by free companies. We don't have to disclose the salaries of all employees in our company right away, such a level of openness does not have to be for everyone, but any company can adopt a number of useful principles."
Knop points to the lack of financial literacy of Czech employees, which must be increased in a targeted manner. But how to deal with a topic that company directors, HR managers or politicians are so happy to take on in practice? How to translate flosculi into a working practice?
Both Knop and Fortelný are clear. Targeted education through all possible channels, including gamification, benefits for completing courses, educational teambuilding, forms only one important part.
At the same time, employees must acquire practical tools to safely control their personal finances, in which financial literacy will be directly materialized as one of the essential qualities. And which employees will directly guide and motivate them to behave financially responsibly. Fortelný compares the situation to driving a car. "All of us who drive a car have gone through driving school. We have gained education and experience, we know the rules of the road. At the same time, each of us is happy to have seat belts, airbag and other safety features in the car."
One such safe tool can be Advanto. An application that helps to better spread income and expenses within a month and that allows simple, fast and intuitive access to your own worked wages multiple times a month. It eliminates unnecessary financial stress, acts as a prevention of debt. Technology also reduces the problem of shame experienced in the past by many employees who went to the payroll office in person to ask for a payroll advance – we are back to the beginning of the problem of financial silence.
Gerhard Knop summarizes his experience and his recommendations to directors and managers of companies in a few simple points:
- Trust in employees and in their competence is the basic building block of a quality relationship between the company and its people.
- Talking to people is essential. Let us ask them over and over again what they need, what troubles them, what pleases them and what they expect.
- Let's offer employees such help or benefits that resonate with their needs.
- Financial literacy must not remain on paper, people need practical tools to help them behave responsibly in the field of personal finance.
