Encouraging your employees to budget is a surefire way to help them on their journey to taking control of their finances.
Actions employees can take to improve their financial health
First, get employees to list fixed expenses such as their mortgage or rent, food, council tax, insurance, car payments and utility bills. Directing employees towards financial advice platforms will ensure that they are taking accurate and safe advice on how to budget effectively. Reaching short and long term goals will be far easier when budgets are managed well.
Another way to help employees budget is to educate them on your company pension scheme. Making it clear how much you contribute as an employer and encouraging them to review their contributions will help them to decide if they could be saving more for their retirement.
Employees may not be aware that there are many free apps and online budgeting tools available to them. Encouraging the use of these tools will help them to keep track of their outgoings whilst allocating the correct amount of money to different areas of their lives. Due to the sad fact that many employees will have debts that they are struggling to pay off, enabling access to a debt counselling service is a great way for you as an employer to help them to start a manageable payment plan. Even paying off small amounts of debt at a time is likely to boost their morale and make a big difference in the long term.
The role of the employer
80% of employers believe that their employees are not saving enough for their retirement. It is important to encourage employees to look at their spending and identify any areas where they are spending more than they should. In this instance, they could be encouraged to use a comparison site to see if they could save on essentials such as utility bills.
Furthermore, employers should help employees to save by taking advantage of savings on initial online food shops and loyalty card programmes provided by popular stores. Employees can be encouraged to review their subscriptions to magazines and entertainment platforms, cancelling any that they do not use or need, therefore saving money.
Offering staff benefits and discounts such as restaurant vouchers will help employees to save on leisure activities. Employees should also be made aware of staff benefits afforded to them such as discounted gym memberships and savings on certain mobile phone tariffs.
When helping employees to set goals for their finances, the SMART acronym should be used. This stands for specific, measurable, achievable, realistic and timely. Following this anagram will give employees the best chance of achieving their goals. By making goal setting a regular activity within your organisation, your staff will be used to the process and will be more likely to use goals to organise and achieve things in their personal lives. Employees will be encouraged when you demonstrate how setting goals is beneficial within the workplace, therefore being more inclined to set goals in relation to their finances.