This article has been supplied by our channel sponsor, Foster Denovo
By Darren Laverty, director of sales and marketing at Foster Denovo, the parent company of employee benefit adviser Secondsight
In early October, we released the results of some research (1) we undertook on the theme of workplace financial education.
According to the survey findings, 52 per cent of employers do not provide any financial education to their employees. The research also found that two-thirds (67 per cent) of the 1,013 UK employees surveyed claim that they do not receive financial education at work. According to the HR professionals surveyed, 50 per cent of them said that their employees had requested financial education at work.
Clearly, employee demand for financial education is not being met, and companies, in general, are failing to support their staff with sound financial and retirement planning.
According to the research, 51 per cent of employers who have a financial education programme in place said the reason for offering it was to improve employee engagement. Meanwhile, 23 per cent of employees say financial education made them more loyal to their employer and this was significantly higher, at 43 per cent among the younger 16–24 age bracket.
However, many employers don’t provide workplace financial education because they think it would cost too much, or because they do not feel it is their responsibility. Some 38 per cent believe the service is prohibitively expensive and a similar figure thinks it is not something they should be providing to their staff.
But let’s be clear here — financial education is very different to providing financial advice. It is about empowering employees to make their own financial decisions with their newfound knowledge, and I believe that HR has a vital role in moving this initiative forward.
Providing workplace financial education doesn’t have to be at a high cost. It should be seen as an investment, because the benefits significantly outweigh the costs.
Financial education is about making people aware of the options available and the course of the action they may want to take. It is surprisingly cost effective for a company to provide. The company would then benefit from more productive and loyal staff, while the individuals would benefit from knowing more about the financial options open to them. It’s a win-win situation for all.
To register for our free ‘Workplace Financial Education White Paper’, please click here.
Secondsight is a trading name of Foster Denovo Ltd.
(1) September 2014 — Secondsight (part of IFA of the Year Foster Denovo), commissioned Censuswide to conduct two surveys. The first survey went to 250 HR employees in companies with 100+ employees, the second to 1,013 full-time employees.