Foster Denovo|News & opinion|News|Financial wellbeing means stepping beyond pensions

Financial wellbeing means stepping beyond pensions

Darren Laverty, Partner at our employee benefits division Secondsight, has written a blog post in Pensions Expert discussing what makes a successful financial wellbeing strategy.

It is fair to say employers have been thinking about financial wellbeing for years – even before auto-enrolment most offered a workplace pension, and perhaps some other monetary protection benefits, such as life assurance or income protection.

But for many employees, this feeling that they are supported in their financial wellness is at best forgotten, and all too often invisible, soon after the initial orientation into their new job.

Your employee’s financial health has a huge impact on them, and in the long term poor financial health is likely to impact on your business. So, it makes perfect sense to support employees with their financial wellbeing.

It has been well documented that there is a link between financial health and mental wellbeing, productivity, and absenteeism and presenteeism rates. Workplace financial wellbeing therefore needs to evolve.

Good strategies consider long and short term

There are four distinct layers that define financial wellbeing:

  • Living within your means.
  • A manageable level of financial stress.
  • Having financial goals and a plan to achieve them.
  • A solid financial foundation including emergency money, low levels of high-interest debt and adequate insurance to protect loved ones.

A good financial wellbeing strategy needs to help people manage their short-term and medium-term financial health, as well  as addressing the long-term pensions and retirement/saving needs.

Behavioural change is needed

We live in a culture where we are all used to getting what we want instantly, which is a big problem. We need to work with employees to get them in the mindset that making sacrifices today and separating our their expenses from luxuries will benefit their financial wellbeing now and over the longer term.

Read the full article on Pensions Expert here.

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