Asia’s leading digital wealth platform, Endowus, in partnership with prominent mental health and well-being support platform, Intellect, has released the Endowus x Intellect Wealth & Well-being Report, a comprehensive study exploring the relationship between financial well-being and key aspects of individual and organisational well-being among 1,000 Gen Z and Millennial workers in Singapore and Hong Kong.
Specifically, the study looks at individuals’ financial preparedness and knowledge – and how these affect, and are affected, by personal factors of mental well-being: growth mindset, resilience, self-esteem as well as workplace well-being dimensions of job satisfaction and turnover intention.
These individual and organisational dimensions were derived from Intellect’s personal insights questionnaire (PIQ)1, a proprietary tool developed to quantify personal and workplace well-being, and the survey was administered by a third-party research agency.
The study’s findings establish a virtuous, cyclical relationship between high levels of financial well-being and personal well-being. For instance, 85% of Singapore respondents said being financially prepared will help them bounce back more easily from setbacks and challenges, while a corresponding 84% reflected that this cultivated resilience will encourage them to continually improve levels of financial preparedness. High self-esteem begets a stronger sense of financial preparedness, and vice versa.
Diving deeper into the strategies Gen Zs and Millennials plan to adopt to enhance financial preparedness, the report concludes that employers and organisations have a crucial role and responsibility to play in improving employees’ holistic financial and mental resilience, particularly with the business objectives of building a stronger, more resilient workforce by boosting job satisfaction and reducing turnover intention.
Current areas of strengths and weaknesses among Singapore’s Gen Zs and Millennials
From the outset, Singaporeans exhibit robust baseline metrics for overall well-being: a high percentage of respondents indicated healthy levels of growth mindset (91%), resilience (80%), self-esteem (83%), and job satisfaction (68%). However, a contrasting figure of nearly 1 in 2 respondents (46%) often think about leaving their job, reflecting considerable turnover intention.
In terms of financial preparedness, a majority (83%) of Singaporean respondents also feel “very prepared”, “prepared” and “somewhat prepared” today — with financial preparedness defined in the study as the confidence that one can financially manage life’s demands, both in the short-term and/or long-term, to provide a sense of control over one’s money situation.
A further 1 in 2 of respondents (51%) express confidence in the current predictability of their primary income source, contributing to this strong sense of financial preparedness reported among respondents.
Strong virtuous cycle between financial preparedness and personal well-being, with room to improve long-term financial planning and confidence
The Endowus x Intellect 2024 report reveals a compelling, virtuous relationship between one’s sense of financial preparedness and one’s sense of self. These findings demonstrate a strong interrelationship between financial preparedness and mental well-being, and how one affects – even compounds – the other. With its significant correlation to mental well-being, the study also revealed Gen Z and millennials’ least confident areas when it comes to financial preparedness, and key areas to shore up.
Despite half of Singapore respondents being confident that their income sources are consistent and predictable, comparatively, only 15% cited sufficient levels of investment proficiency to understand the right type of investments for their financial goals.
Another 15% were confident in their ability to build an adequate retirement nest egg, highlighting the need for individuals to adopt a longer-term view on their financial planning, to stabilise their financial safety net further with meaningful wealth accumulation.
Samuel Rhee, co-founder and chairman of Endowus, said, “Endowus understands that improving individuals’ financial preparedness will strengthen the very fabric of society, by enabling more people to achieve retirement adequacy and avoid longevity risk, that is, not having enough to support their silver years.”
“It was in our name to inclusively democratise institutional endowment-quality investing for all of us — through informed wealth management and greater access to the right resources, we can empower Singaporeans with the knowledge to secure a brighter future for themselves and their loved ones by investing holistically and responsibly. This is why we continue to prioritise financial literacy on all our platforms,” he said.
Rhee added, “The power of financial knowledge is especially critical in a challenging environment of protracted financial pressures, with inflation eroding the value of cash and deposits and the chances of home ownership diminishes more for the next generation. In partnership with Intellect, Endowus is committed to working with forward-thinking organisations to design effective, personalised employee welfare programmes that make a meaningful impact on their teams’ overall well-being and financial futures.”
When asked about immediate next steps, most Singapore respondents opted to increase their emergency savings (46%) as a means to boost their financial preparedness, implying that saving for rainy days is their preferred solution to keep funds secure.
These findings highlight the need for Singaporeans to more effectively manage their cash savings and consider investing their emergency funds in low-risk, inflation-hedging assets such as money market funds that offer flexibility in liquidity.
At an average interest rate of less than 1% for most savings accounts, the effect of high inflation will drastically erode the value of any emergency savings left in one’s bank over time.
Respondents also recognised the importance of income stability and income diversification amidst the city state’s weak hiring outlook3, indicating the demand for upskilling to maintain employability and pursuing alternative income streams beyond their primary source for financial independence and security.
Financial preparedness and personal well-being have a direct impact on workplace outcomes
The study also looks at how the relationship between financial preparedness and personal well-being can affect workplace outcomes such as job satisfaction and turnover intent, revealing profound implications for businesses and organisations striving to build strong, sustainable, and productive workforces.
For better workplace outcomes, employers play a crucial role in supporting holistic well-being Given the clear correlation between financial preparedness and workplace outcomes, organisations can benefit from integrating financial wellness into their employee well-being, engagement, and retention strategies.
Employers play a crucial role in fostering the holistic well-being of their workforce. A significant 1 in 3 Singapore respondents desire greater workplace support through financial wellness workshops (34%), personal finance interest groups (33%), and financial literacy training sessions (34%). This sentiment is echoed particularly strongly among Millennials, with 35% expressing a preference for both financial wellness workshops and financial literacy training.
Notably, another 35% of Singapore respondents are also looking for their workplaces to offer mental wellness workshops, reflecting a growing understanding among Gen Zs and millennials on the interconnectedness between mental health and financial well-being.
Rather than seeing these two dimensions as mutually exclusive, organisations can look to offer mindfulness training sessions focused on financial stress reduction techniques and provide access to counselling services that specifically address financial anxieties and their impact on mental health.
Endowus will be further enrolling their client-facing representatives in a mental health first aid course to better equip their advisors to handle wellness challenges. Collectively, Endowus and Intellect are keen to further study the challenge of financial preparedness and improve their respective services.
Both organisations will be co-hosting a Zoom webinar on July 23, 2024 to unpack these findings and their implications for C-suites and HR professionals wanting to build more resilient workforces. They are also exploring deeper case studies with financial institutions to identify the efficacy of more targeted financial wellness assistance and intervention for employees.
Theodoric Chew, co-founder and chief executive officer of Intellect, said, “Research consistently demonstrates the deep interconnection between financial well-being and mental well-being, with financial stress often leading to anxiety and reduced mental health. The findings from our joint study with Endowus reinforce this link, highlighting the urgent need for comprehensive wellness solutions.”
“At Intellect, we have launched mental and financial wellness workshops, coaching, and platform content to address these challenges. By integrating these initiatives into their well-being strategies, employers can better support their employees to thrive in the workplace, resulting in higher job satisfaction and lower turnover rates. We look forward to exploring avenues with Endowus on these crucial initiatives,” he conclude.
