In today’s financial climate, saving money is more crucial than ever. Owning a home, starting a family, and securing a future all hinge on financial stability. However, a recent study by money.co.uk highlights a troubling trend: a significant portion of working Britons are unprepared for their financial future.
The statistics are stark: one in seven Britons has no savings, and a quarter of UK working adults have less than £100 in their savings accounts. This is far below the recommended three-month salary safety net advised by financial experts. According to the Office for National Statistics, the average household savings ratio has fallen to its lowest level in decades, emphasising the urgency of this issue.
But is it the responsibility of businesses to support their employees' personal finances? At our company, we believe the answer is yes, but in a unique way.
Financial literacy and savings education initiatives within businesses are gaining traction, thanks to non-profit financial well-being providers. Harlowsave CU (part of Plane Saver CU), one of the UK’s largest non-profit financial well-being organisations, surveyed 11,000 full-time workers to understand their financial health. The results were encouraging; employees using their financial well-being services experienced steady growth in their savings. On average, members—ranging from large airline employees to small business workers—accumulated £2,500 in savings.
How does this work? Through a payroll savings scheme that is free for businesses to implement, employees can automate their savings directly from their payroll. Employees decide how much they want to save each month, and the amount is deducted before reaching their bank accounts, accumulating in a separate savings pot.
This summer, a Harlowsave CU event highlighted the scheme's success when an attendee discovered she had unknowingly saved £6,000! Additionally, their integrated member discount platform offers savings on everyday essentials at major supermarkets and high street shops, helping employees save even more for their future. According to a survey by Employee Benefits, such discount platforms can save employees an average of £500-£1,000 annually on their everyday expenses.
Financial resilience often requires a mindset shift, viewing saving as an empowering habit. Payroll savings partnerships, like those offered by Plane Saver, allow businesses to encourage effortless saving among their employees.
As these schemes become more popular among businesses of all sizes, British workers are building a collective safety net and reducing financial stress. A report from the Chartered Institute of Personnel and Development (CIPD) found that financial well-being initiatives can improve employee productivity and reduce absenteeism, making it a strategic investment for companies.
As a business, you can support your employees' personal finances without any cost to your company. Let’s champion financial well-being in our workplaces and contribute to a more secure future for all.