The latest Financial Wellbeing Research (“the REBA research”) by The Reward & Employee Benefits Association (REBA) in association with WEALTH at work, reveals the need for employers to introduce their organisations to a range of financial wellbeing support that will help them to build the financial resilience of the workforce, as well as attract and retain top talent and manage organisational risk.
Here are five top tips to help employers do just that.
- Create a joined up strategy
A financial wellbeing strategy must be aligned to the business objectives and be embedded in the workplace culture for it to be effective. But the REBA research shows that while over half (52%) of employers offer financial wellbeing benefits/services, they are not joined up in a strategy. Further, just 20% of larger businesses have a mature or well-developed financial wellbeing strategy.
It is important that employees have a clear understanding of what workplace benefits are available to them, and how these can work together to support their overall financial wellbeing. This could include an Employee Assistance Programme (EAP) offering debt advice, access to discount schemes, and the option to attend financial education sessions, all of which combined can help employees take control of their day-to-day finances.
2. Offer a range of support
The REBA research reveals that pensions still dominate employers’ financial wellbeing support, with 76% of employers having rated their support for retirement saving as ‘very good’ or ‘fair’, compared with just 37% of organisations that rated their support for building a financial safety net as ‘very good’ or ‘fair’.
But employee demand is growing for well-designed financial wellbeing strategies. The research reveals that four in 10 (44%) employers are experiencing such a demand, which is perhaps unsurprising given the current cost of living crisis affecting so many workers. But this comes at the same time as two-thirds (66%) of employers rate their workplace debt management support as ‘poor’ and only 6% believe their organisation is very good at supporting budgeting and money management. All areas that are likely to become more prevalent because of the current environment.
This is a clear call to action for employers to provide short, medium and long-term financial wellbeing support for employees, which means providing tailored support at all career stages and covering a mix of needs, such as debt management, building up an emergency fund and saving for a first home, as well as retirement. Employers may also want to consider funding a range of workplace savings and benefits such as workplace ISA’s, share plans or discount and salary sacrifice schemes, to support these needs and build financial resilience.
3. Make it accessible to all
Whether companies have staff that are office based, in the field, on a production line, working shifts, or even overseas, financial wellbeing support must be accessible to all to optimise buy-in, and boost employee engagement. This means considering things like the number of different languages spoken throughout their workforce, as well as which employees have a digital device through which to access information, and which workers have an email address as a point of contact. Offering a range of delivery methods for financial wellbeing support can also ensure the majority of employees are always supported. This could include classroom based financial education sessions, interactive online seminars, or even webcasts and digital tools including a ‘Financial Healthcheck’ that can be used anywhere, on any device.
4. Put measurements in place
The REBA research shows that more than a third (35%) of employers do not measure any aspect of financial wellbeing at present and that just 40% use financial wellbeing programme participation rates to measure the effectiveness of their financial wellbeing initiatives.
Measurement is a crucial part of any financial wellbeing programme, as without it, it’s almost impossible to know if what’s on offer is a success. One way of doing this is to monitor if employees are actually using and engaging with it. For example, looking at the take-up rate of financial education sessions offered, or how many employees have viewed a webcast on the intranet. Employee surveys can also be carried out to see what positive steps have been taken following financial education, such as employees increasing pension contributions, or a survey could record knowledge before and after an intervention to show how it may have improved.
5. Bring in a workplace specialist
The research shows that responsibility for providing financial wellbeing support in the workplace currently falls squarely with pension providers (83%). This explains the skew towards retirement support, where 69% of respondents said that they offer guidance on retirement issues or plan to do so, compared with just 46% who provide support for financial emergencies. It is almost inevitable that product providers will focus financial wellbeing on their areas of specialism. But there is a risk that such support will become siloed and miss ‘big picture’ concerns, such as general financial literacy and resilience. Increasing numbers of employers are now turning to specialist financial wellbeing providers to help their employees engage with their finances throughout their career.
Jonathan Watts-Lay, Director, WEALTH at work, comments; “Financial wellbeing support is key to organisations becoming an employer of choice. Helping employees to understand the key financial issues that relate to them, through providing a range of financial wellbeing support that is underpinned by financial education and guidance, is the most effective way of achieving this. Not only does it strengthen the financial resilience of the workforce but it can also increase engagement levels and aid with recruitment and retention.”