How to help first-time buyer employees to save for a deposit faster

Author Name: Jonathan Watts-Lay, Director, WEALTH at work

“With the current cost of living crisis putting pressure on household finances, it is now even more difficult than ever for first-time buyers to get on the property ladder. Therefore, it is extremely important for employers to offer their workforce as much support as possible.

There are various savings vehicles that can help employees save for a deposit such as ISAs or share schemes like Save As You Earn or Share Incentive plans. The Lifetime ISA (LISA) can be particularly helpful as it provides a guaranteed 25% bonus from the government. There are also a couple of variations of the ‘Help to Buy’ scheme that could be useful for some, including the mortgage guarantee scheme announced in the 2021 Budget, which offers lenders the option to purchase a guarantee on mortgages where a borrower has a deposit of only 5%.

However, with a plethora of choices, employees will need to understand the advantages and disadvantages of each of these savings methods to fully take advantage of them, and choose the most appropriate for their needs.

Not only this, employees will also benefit from support on how they could better manage their finances in order to free up more money to divert into their savings.

There are many people who believe home ownership is beyond their reach. Helping these employees manage their finances, whilst providing them with a good understanding of the benefits and support available to them can make all the difference.

The best way to achieve this is through coaching via financial education and guidance sessions delivered in the workplace. More and more forward-thinking organisations are now switched on to how this can help employees and offer this support as part of their overall wellbeing objectives.”