“May you live in interesting times” may be a clumsy rendering of the Chinese proverb, “It’s better to be a dog in a peaceful time than be a man in a chaotic period”, but it has certainly been relevant in recent years, through the pandemic, soaring inflation, and spikes in rents and interest rates, with significant price rises for basics like food, fuel and energy.
But if the cost-of-living crisis has brought any benefits, one of the main ones must be employers’ greater focus on employees’ financial wellbeing. Office for National Statistics’ figures show that real average UK earnings fell between 2019 and 2023 and survey after survey has shown the impact of financial pressures. For example, 11 million adults have under £1,000 in savings, according to the Resolution Foundation; UK adults’ average unsecured debt was £3,797 in 2022, according to The Money Charity; and two in three UK employees are refused bank loans, while one in three run out of money before payday, according to Salary Finance.
Studies also demonstrate strong links between money worries, mental health issues, staff absence and reduced workplace productivity. So, employers have skin in the game, as well as wanting to help colleagues bring their best selves to work. But rising prices impact employers too, so it is vital to find cost-effective solutions.
Thankfully, employees’ financial wellbeing can be supported in all sorts of ways without breaking the bank, as we have seen here at Wolseley. A good place to start is an open dialogue about the pressures colleagues are facing, so impactful interventions can be chosen. That said, people are likely to be facing a range of concerns from struggling with daily living costs or funding one-off purchases, to dealing with problem debt or worrying about remortgaging their home.
At one end of the scale, employee discount platforms and low-cost loans can help meet immediate needs and reduce costs. Some businesses maintain weekly payrolls or provide on-demand pay to help match income with outgoings. And salary sacrificing eligible benefits can reduce the cost of everything from pension contributions to car leases for colleagues and the business.
Providing access to simple savings products which can be topped up direct from payroll can help people develop rainy-day funds, and longer-term vehicles like individual savings accounts (Isas) and share plans can really bulk up savings. And making sure the organisation’s pension scheme has matching contributions, strong investment management and competitive charges helps make retirement savings one less thing to worry about.
Help and guidance through the financial jungle is another important aspect; discount platforms often include free mortgage advice, colleagues can be signposted to charities to help with problem debt, and many employee assistance programmes (EAPs) include financial counselling. Increasingly, pension providers enable access to discounted financial advice, paid for from members’ pension pots.
And finally, complexity and lack of understanding can put people off dealing with financial issues. So, do not forget to promote your offering on a regular basis, using simple descriptions that chime with your people, and always make sure each element is easy for them to access.
Ant Donaldson is reward manager – benefits at Wolseley Group
