By:James Herbert, founder & CEO, Hastee
Over the summer months, the UK warmly welcomed the easing of all restrictions and thankfully, the sun made a welcome appearance just in time for the reopening of beer gardens. Millions of us jumped at the chance to get a haircut,head to the gym and see friends. In fact, according to Jefferies Investment Bank, the British economy as a whole proved far more resilient than expected, with the growth forecast now expected to reflect a burgeoning economy.
Today, the whole country is continuing to benefit from increased freedoms and minimal restrictions. But it’s worth considering that, for many workers, as yet again means a change in spending habits and how they manage their money over the course of the salaried month.
Not only that, but the potential to spend money is again on the rise: whether it’s a train ticket into the office, a meal out after work, or simply visiting clients once again, the prospect of finding money for a raft of expenses could lead to inevitable increases in financial pressure and stress.
It’s an issue that’s especially relevant after over eighteen months of living with COVID-19. Nearly two thirds (61%) of UK workers say they waste an extra £100 each week on booze, shopping, and other ‘unnecessary luxuries’ since lockdown ended, according to a study we conducted recently. Employees have had to become more savvy with their money, especially with the possibility of furlough and reduced funds.
That said, plenty of us have got into good financial habits over the past year too, with an estimated £143.5billion stashed away in savings since the beginning of the first lockdown last March. However, with shops shut and nowhere to go, this has sometimes been a result of circumstance rather than conscious choice and, for many, now is a potentially crucial time to either cement better financial health or revert back to old, less positive habits.
So, as workers begin to head back into the office, it’s the perfect time for businesses to play a supportive role in helping their employees to bolster their financial fitness. But what can companies do to guide their staff through this period of further financial uncertainty?
How businesses can help boost financial fitness
For starters, simple advice could go a long way. Businesses can support employees on this by providing financial wellbeing advice as well as rewards to help turn saving into a habit.
Companies can introduce employees to budgeting tools, helping them to keep track of their spending on a daily and weekly basis. It’s the sort of thing many of us take for granted, but it’s well worth keeping tabs on exactly what we’re spending once we’re out and about, as lunchtime snacks, after-work drinks and frequent journeys into town can soon add up.
Helping employees to embrace smart financial choices may also be easier than you think and, in some cases, all it takes is a simple nudge to help people to make better and more informed financial decisions.
Employers can make a huge difference over the coming months by offering an ‘Earnings on Demand’ (EoD) payment model, providing access to a portion of an employee’s monthly pay in real time, and offering a more affordable alternative to high-cost credit options such as overdrafts, credit cards or payday loans.
Making budgeting easier
Not only does Earnings on Demand make it possible for employees to access their wages at a time they need it most, it also makes budgeting a whole lot easier by providing greater visibility into hours worked and wages accumulated. And knowing how much money you’ve got at any particular time during the month can make it easier to get a handle on essential spending and saving.
Employees aren’t the only ones to benefit from Earnings on Demand, with businesses themselves also reaping the rewards. After all, a happy employee is a more productive employee, and fewer worries about finances can help workers to focus instead on the things they do best. With 43% of workers saying it has affected their work behaviour and nearly half (46%) of respondents claiming to live ‘payday to payday’ according to the same data, access to more flexible pay has the potential to revolutionise a business. Earnings on Demand solutions can also be easy to implement, integrating seamlessly with a company’s payroll and helping to attract, engage and retain employees.
Whether it’s providing advice to help employees stick to more responsible financial habits, or providing alternatives to high-interest credit options at a time when employees are desperately in need, business leaders and employees have the opportunity to take stock and embrace new habits that can support a financially fitter and healthier future.
The pandemic has provided the footings to change the way we live our lives, to shake up our work-life balance, and to reassess our priorities. But it’s also been the perfect opportunity to get our finances in shape at the same time.