What really drives people to change their financial behaviour?

26 Nov

Here's a sobering stat: 40% of our behaviors on any given day are driven by habits (Duke University). Which means changing what we do - especially with money - is genuinely hard.

We've spoken to hundreds of people about their finances over the years, and the reasons they finally got their act together vary wildly. Some were forced to after a divorce. Others had a milestone birthday looming and panicked. A few watched a friend do it and thought, "If they can, maybe I can too."

There is no silver bullet for driving lasting financial behaviour change. Research and practice consistently show that our behaviour is influenced by a complex mix of cognitive, emotional, social, and structural factors.

As an employer, you can't control when someone will be ready to make a change. But you can create an environment so that when they are ready, they're set up for success.

So what does the research tell us about what employers can do to support employees to make meaningful financial changes?

Timing matters

Information is most effective when it shows up right when someone needs it, or what researchers call "just-in-time" delivery. Enrolling in KiwiSaver, getting a bonus, expecting a baby, and facing redundancy are just some of the moments when people are paying attention and ready to act.

To use a health analogy, the best time to engage with people is when getting on top of their personal finances goes from being a nice-to-have vitamin to a must-have Panadol.

Make the right thing the easy thing

We all know we should save more, pay down debt faster, review our insurance, etc. But knowing and doing are different things. When the path from intention to action involves too many steps, most of us just...don't.

This is where employers can make a real difference. If your payroll system can automatically split deposits into different accounts, that's one less decision employees have to make. If you have a financial advisor or coach come to the workplace to offer sessions, rather than sending people offsite, you’ve lessened the logistical hurdles. Even something as simple as emailing people the KiwiSaver form rather than making them hunt it down removes a barrier. Small friction is often what stops good intentions from becoming reality.

One size does not fit all

Generic financial information tends to land well with people who are already comfortable with money. For everyone else, such as people with irregular income, large debt, English as a second language, or different cultural approaches to money, generic guidance often misses the mark.

Programs that meet people where they actually are work better. That might mean offering content in multiple languages, acknowledging different cultural approaches to family obligations, or providing one-on-one support for complex situations.

Creating a workplace culture that openly supports financial wellbeing

The Commission for Financial Capability found that one in three New Zealanders rarely or never talk about money with anyone, including close friends and family.

That awkwardness makes it harder for people to learn, ask questions, or know they're not alone in struggling. Creating a more open culture doesn't require massive effort. It could look like:

Inviting your people to participate in Money Week activities
Running a lighthearted stock-picking competition
Leaders talking about their own financial learning journey

When talking about money stops feeling taboo, people are more likely to engage with the resources you're offering.

Build in repetition and reinforcement

Behaviour change takes practice. A single seminar often fails because there's no follow-up or opportunity to practice new skills. You don't take one tennis lesson and become good at tennis. Building financial capability is the same. Effective programs build in regular touchpoints: follow-up sessions, email reminders, tools people can return to, and ways to see progress.

What this means for employers

You can't force people to change their financial behaviour, and you won't know when each person will be ready to engage. Someone might ignore every financial wellness email for two years, then suddenly face a situation where they desperately need help.

Real financial behaviour change happens when someone is ready, has clear next steps, faces minimal barriers, and has support to follow through.

This is why having ongoing access matters. When support is always available or at least regularly offered, people can engage when it's actually relevant to them.

Now for the important legal part: The information we provide is general and not regulated financial advice for the purposes of the Financial Markets Conduct Act 2013. Please seek independent legal, financial, tax or other advice in considering whether the content in this article is appropriate for your goals, situation or needs. The information in this article is current as at 23 November 2025.