Nearly three quarters of employers would fund employee financial education – but would the FD?With the new pensions freedoms announced in the 2014 Budget due to be implemented shortly, sound financial advice is a must for everyone – especially those near retirement age.
While employers may fully comprehend the benefits of employer-sponsored financial advice and accordingly nearly three quarters (73 percent)* said they would like to fund this, Jelf Employee Benefits believes that sometimes the Financial Director may need more convincing. Based on coal-face experience, the company has compiled a list of common questions and persuasive answers to help influence the finance department.Jo Thresher, head of Money at Work, Jelf Employee Benefits said: “Funding financial education is going to be a discussion that many organisations will be having and it’s important for the HR department to put forward a strategic approach to win over the finance team and secure that all-important budget.”
What’s the point of financial education? Financial worries can be a distraction for employees but a happy workforce is more focused and productive: employers can retain talent and save on recruitment fees if their employees feel supported and valued.Can’t I just give them a bonus instead?Employees need advice about how to better manage their money. A one-off increase doesn’t help an employee understand how to live within their means, manage debt or avoid getting into financial trouble in the future.
Can’t I just get financial information online?To be effective and truly demonstrate a commitment to employees, financial education needs to go beyond directing them to a third-party website. A personalised and interactive approach is more likely to produce the desired results of a worry-free and productive workforce.How long will employees spend away from their desks?A better question is how long will employees be away from their desks if you don’t offer financial education. The reality is, employers can offer anything from an hour up to several days but without financial education, employees may be absent due to the stress caused by worrying about finances.
How will I know if the financial education we’re offering is working?The obvious way to gauge success is to ask for feedback after the session(s) but perhaps a better way is to ask employees if they’ve actively taken steps to improve the way they manage their money. Internally, you can also keep track of absences and in the longer term you could start to see a decrease as employees become less stressed and more in control of their money.What is the downside to the business if we don’t do it?As many as one in five employees lose sleep due to worrying about finances** and it’s a problem that can affect all staff, not just younger employees or those on smaller salaries. This can lead to absence which costs businesses money. It is vital to treat the root cause rather than the symptoms which in this case is stress caused by financial anxieties.Jo Thresher concluded: “Nearly four in ten employees say they would move to a company that put financial wellbeing as a priority**, which is food for thought for any FD unsure whether to commit to a programme of financial education.”
