27% of UK adults cite financial worries as a trigger for mental health issues but more than a third don’t know where to go for help. WEALTH at work shares some tips on how employers can help combat this before it spirals out of control
It is not uncommon for employees to face financial worries at various stages of their life whether that is dealing with spiralling debt, concerns over retirement savings or simply making the monthly budget work.
The link between debt, money worries and stress, lower productivity and absenteeism are increasingly recognised by employers. As Reward’s Wellbeing in the Workplace* research found, 66% of employers believe that financial worries caused increased levels of stress, 44% said it resulted in lower productivity and 38% said that it lead to absenteeism due to personal financial problems.
As the focus of this year’s Mental Health Awareness day is mental health in the workplace, WEALTH at work, a leading provider of financial education, guidance and advice in the workplace, shares expert tips for employees wanting to cut their costs and boost their savings:
1. Do employees know where their money is going?
Employees should check their bank statements and make a list of what they are spending each month. It is helpful to divide these into utility bills (gas, electricity and water), mortgage or rent costs, council tax, supermarket shopping, monthly contracts for TV, broadband and mobiles, insurance, regular subscriptions, and other spending. This will highlight where an individual’s money is going and where savings could be made.
2. Compare utility providers
Employees should consider visiting comparison sites to find out which providers may be the most cost effective for them. For example, Ofgem found that customers who switched supplier saved around £200 annually**.
3. Look for discount vouchers
Do employees know that there are great discounts available for online supermarket shopping, holidays, restaurants, broadband providers and computers etc? For example, many supermarkets have offers such as £20 - £30 off first online orders and we found that £52 could be saved on £240 worth of groceries***.
4. Is the latest mobile phone really needed?
Employees could consider a SIM only deal rather than upgrading to the latest phone if their phone contract is coming to an end. With a contract, individuals are effectively borrowing money for the phone, and repaying this loan through a monthly bill. Also, tariffs should be checked as there are some very competitive deals available.
5. Regular contracts should be reviewed
Are your employees making the most of the subscriptions they have? Could they cancel music and other services that aren’t being utilised? They may benefit from calculating how much is spent on these types of contracts and seeing how much of a difference cancelling these may make. For example, savings of £210**** a year could be made by cancelling a couple of subscription services.
6. Watch out for auto-renewals
Many insurance policies for cars, homes or holidays, automatically renew each year but employees may not be getting the best deal if they allow this to happen. For example, it’s estimated that £2.37 billion a year is wasted by individuals ‘auto-renewing’ their car insurance *****. To get the best deal and to avoid any potential price hikes with auto-renewal, employees should shop around and either try to negotiation a better price, or switch where appropriate.
7. Staff discounts
Are you encouraging your employees to make the most of any staff discounts offered? By signing up to a workplace discount scheme, employees could get discount codes to high street stores or buy reloadable store gift cards, which allows them to buy the credit at a discounted price.
Jonathan Watts-Lay, Director, WEALTH at work, comments; “We believe it is important to help employees feel secure when it comes to their finances. A relevant and well communicated financial education programme can deliver on this and is mutually beneficial to both employers and employees.
Learning how to manage money is an important life skill. We have educated thousands of employees on topics such as how to save money on bills and how to manage spending and debt, as well as the importance of saving from retirement. The lessons learnt, can save a fortune over a lifetime.”
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* WEALTH at work recently conducted a survey with Reward to investigate the importance of wellbeing in the workplace. http://www.wealthatwork.co.uk/corporate/your-say/surveys/
**Comparethemarket.com (https://www.comparethemarket.com/utilities/) September 2017. Ofgem found that customers who switched supplier (having never done so before) saved around £200 annually.
*** Offers correct June 2017. Sainsbury’s £12 off first order (£60 minimum spend), Waitrose £20 off first order (£100 minimum spend), and Ocado £20 of first order (£80 minimum spend).
**** As of September 2017 Netflix standard package costs £89.88 a year (https://www.netflix.com/gb/#this-is-netflix) and Spotify Premium is £119.88 a year (https://www.spotify.com/uk/student/). Total saving of £209.76 to cancel both services.
***** Moneysupermarket.com (http://www.moneysupermarket.com/hubs/car-insurance/auto-renewals/) – Research has shown an estimated 23% of drivers (over six million motorists) auto-renewed last time around and paid up to £113 more than they had to on the cost of their cover. It’s estimated that every year in the UK individuals are spending a £2.37 billion more than needed on car insurance by allowing policies to auto-renew instead of finding cheaper deals elsewhere.