Preparing staff for financial schooling
Productivity gains in adding education remit
A constant onslaught may influence success
Form versus function
Share mechanics of perks Share mechanics of perks
Bill pensions as need to save so interest is boosted
Switch on to retirement as early as you can
Appreciating benefits
Letting staff career ahead
Some employers may query why they should provide financial education for staff. The benefits are clear.
For starters, the more education you give staff about the perks on offer, say on pensions or shares, the more likely they are to understand their true worth, including any potential tax benefit. This is important. If staff value the benefits on offer then they are likely to hold their employer in higher esteem which, in turn, should boost productivity and staff retention.
Much is also made of our increasingly litigious society. Some employers in the US have reportedly faced court action from employees with grievances over benefits provision. But by offering financial education, employers will guard themselves against this risk as employees will be hard-pressed to argue that they were not given the full picture.
But the most compelling reason though is the research conducted in the US by Dr E Thomas Garman, president of the Personal Finance Employee Education Foundation, which demonstrates the positive impact of financial education on employee productivity levels.
Amanda Wilkinson,
Editor, Employee Benefits magazine
I agree, as in my role as an IFA I have presented many financial education sessions covering both specific employer benefits and external pension and savings options to employee groups ranging from 10 to 40 at a time.
Perhaps the biggest surprise has been the apathy sometimes apparent in relation to great value employee benefits such as ‘buy one get one free’ share investment plans (SIPS with one ‘P’, not the pension type).
Offering 1-2-1 sessions after group presentations has often resulted in advising those who are not members of these schemes (or only making minimal payments to them) to maximise them where affordable and comfortable with the potential risks/medium term nature. This can only be good for the employee and employer and should make the IFA fees to the employer more than worthwhile if it results in just one more employee staying longer term having understood the value of their package.
I have also had occasion to advise indidviduals who seemingly have had ‘amazing’ offers to join smaller competitor firms with much higher salaries but no or little benefits. In the majority of cases the ‘better package’ was not really better taking into account the loss of maybe 8% in pension contributions (assuming full use made of any matching), the above SIP schemes, sickness benefits, medical insurance and the potential profits from SAYE share schemes.
Salary is not everything. Employers know this. HR professionals know this. IFA’s know this. It is just a case of ensuring that emplyees know this and face to face education sessions or 1-2-1 ‘Surgery’ sessions are in my opinion the best way to acheive this.