Why family financial health is an issue for employers

Mirza is a fintech company focused on long-term family financial health, which means  addressing the structural issues that lead to women dropping out of the workforce.

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Mirza is a female-founded fintech start-up which focuses on family financial health. Already, just over a year since it launched its website, the company has attracted a range of personal finance experts, VC investors and C-suite executives to its board.

Not bad for two master’s students who went from sketching out their plans on napkins to incorporating the company in just a month.

Mel Faxon and Siran Cao [right] were both US master’s students in the UK. After being introduced and hitting it off, they started talking about doing something in the health space and stumbled on the idea behind Mirza after “lightbulb conversations” in January 2020. Mel had been doing some research on the menopause. “We were talking about how we view our bodies as pregnant, post partum and menopausal; how we also view our body as our home and how work is on a separate track. When you start a family the two worlds crash together and influence each other,” says Siran.

They decided that they could do something to address the issue.

The two women initially wanted to build a resource to support women to manage the costs of being a working mum. That soon broadened out to embrace families as a whole.

“We want to help families understand the long-term impact of their decisions and that so much of this is structural and political,” says Mel.

That includes – usually – women’s decision to give up work because childcare is at least as expensive as their earnings. Mel and Siran want women to consider the longer-term financial consequences of dropping out of the workplace – particularly at a point in their career when their earnings may accelerate if they stay at work – not only on their future earnings, but on their retirement income, feeding the gender pension gap. “These costs can be hard to visualise. We want to help people make better informed decisions,” says Mel.

Childcare

Mirza has been developing an app which enables people to compare childcare costs in different areas and work out what their outgoings might be in the short term, but also what the long term implications might be. Ultimately, however, they want to use the information to make childcare more affordable and feed back to policymakers the economic rationale of keeping women in the workforce, particularly at a time of acute skills shortages in many sectors. 

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They have been working with local government and employers to influence policy and find real solutions rather than placing all the onus on individuals. “We need to change how employers think about childcare,” says Siran.

In the US, they say premium subscriptions to childcare and back-up care providers are seen as benefits by some employers. “We need a fundamental shift in thinking,” she adds. “Childcare is crucial for working families; it is not a benefit.” She adds that childcare should instead be seen as a form of healthcare because good childcare is a factor in working parents’ mental health and it enables them to keep working and earning, which is also crucial for wellbeing.

Indeed financial health is one of the biggest stress factors in mental health at work surveys.

Mel left] and Siran say that there is definitely an appetite among local government to address the childcare issue in an innovative way. One example is the Greater London Authority’s initiative to loan money for childcare deposits which can be paid back once a person is back at work and earning.

Financial health

They are also planning other products and the company has today announced its first pilot in the US with global communications agency Clarity. This will mean Clarity’s US employees will have full access to Mirza’s suite of features, including a personalised, informative financial plan specifically for families and unlimited educational resources for working parents. The aim is to enable them to build their own customised financial and childcare plans and see how these fit into their career goals as communications professionals.

Clarity will have access to anonymised data from its employees to allow them to make more informed decisions about their employee benefits and help reduce gender bias.

Mirza are also in touch with a couple of UK employers who are interested in boosting their employees’ financial health and, once the UK childcare data is available, will roll out a bigger pilot in both the US and UK next year. 

“Financial health is the next big frontier for employers,” says Siran, adding that despite technical delays, the pandemic has made it easier for the company to meet with employers and others and has accentuated some of the issues they are hoping to address. 

“Mental health is now in vogue, particularly as a result of the pandemic,” continues Siran, “and mental health is huge, but financial health is related to this and employers are taking more of an active role in addressing this.”

 



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