Financial troubles result in poor health

If you get into trouble financially, your health is also likely to suffer. This is one of the conclusions reached by financial services company MMI after it correlated death and disability claims with the MMI Unisa Consumer Financial Vulnerability Index.

More employees are likely to take off “sick” from work on payday than on other days, particularly if they are heavily in debt, because concerns about debt repayment peak on pay-day, Rowan Burger, the managing executive: strategy and market development at MMI Corporate and Public Sector, says.

“Consumers are worried about the people waiting outside the [company] gate wanting their share of their pay packet.

“When matters get very serious, life assurance companies also see a spike in suicides, as happened last year during the mining industry strikes.”

Burger says that financial vulnerability leads to health vulnerability, and it also affects productivity and family life.

Nomha Kumalo, MMI’s managing executive: organised labour and public sector clients, says debt issues do not affect only low-income workers.

Speakers at the launch of the MMI Unisa Consumer Financial Vulnerability Index this week agreed that one of the problems is a low level of financial literacy.

Raising the level of financial literacy would slow the trend of consumers spending more than they earn and taking on debt to make up the shortfall.

Burger says employers need to play a far greater role in educating their employees about managing in their finances, in the interests of company productivity and employee welfare and improving the socio-economic environment in which they operate.

He says that although many human resources managers recognise the advantages of investing in financial education, many financial directors are concerned only about short-term costs to the company. As a result, MMI has initiated research into the relationship between financial vulnerability and productivity.