The key ingredients of a financial wellbeing strategy
What does “financial wellness” mean to your business and your staff?
Is it about supporting individuals who are struggling with debt or encouraging them to put more aside for retirement? Do you want to help employees better manage their tax or make sure they are saving into the right financial products for their needs? Are you focused on creating a more productive workplace where individuals are in control of their finances and are not distracted by money worries?
It could be all, or any, of the above - or a completely different interpretation based on your workforce’s needs.
Whatever your priorities for financial wellness, building a strategy that really resonates with your employees and creates positive change for them is essential. But it’s not always possible to address every possible angle all at once. Getting started could be about prioritising what’s most pressing for your workforce or addressing a specific challenge, such as encouraging staff to save more into their pension as their career progresses.
The workplace is a great place to deliver communications, guidance and advice about individuals’ finances. Most employees are already used to getting information about work and money from their employer through their regular salary and pension payments. But crucially, a successful financial wellness strategy needs to take things one step further – it should enable employees to take action to improve their finances.
What are the seven steps?
In our seven-part series launched throughout 2018, we look at the key ingredients of a successful financial wellbeing strategy and how to bring them together.
Planning and budgeting
Helping staff to take control of their finances, so that they know how much they’re spending and can build up savings to cope with unexpected everyday costs.
Prioritising which debts to pay off first and making sure employees put aside the money to meet these.
Taking out personal protection, to give individuals the peace of mind that they are covered in difficult times.
Choosing to buy a property is the largest financial commitment that most of us will ever make. It can also mark the start of a new life stage, shifting from the transient world of renting to the long-term commitment of home ownership. That move might also be linked to other events – such as accommodating a growing family or a change in relationship.
Savings and investments
The workplace is an ideal place to help staff save into the right products for them and build a long-term plan for their finances.
Who wants to pay more tax than they have to? Helping employees understand how to manage their tax effectively is another crucial element of financial wellness.
Planning for retirement
Even if it seems a long way off, it’s important to think about how the savings that an employee (and employer) puts aside for retirement will turn into income in later life.
Everyone is different and will have their own needs when it comes to improving their own financial wellness. Don’t assume that because someone is a high earner that they won’t need help with debt - or that millennials aren’t engaged with saving for retirement. Every employee’s circumstances are unique and will change over time in line with their priorities and life stage.
Having a financial wellness strategy is an opportunity to inspire all your staff to think differently about their finances. The result is a more positive and healthy life for your staff – and a more engaged, productive workforce for your business.
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