Financial Wellness: empowering employees in the cost of living crisis

In an era of escalating prices and economic uncertainties, support for employees’ financial wellness should be a crucial component of any employee wellbeing and benefits strategy.

As the cost of living crisis tightens its grip on individuals and families, employers must recognise the profound impact it has on employees’ overall wellbeing. The repercussions of financial stress can be far-reaching, affecting employees’ physical and mental health. As well as their productivity, performance, and engagement in the workplace.

But how can organisations address the diverse financial needs of their workforce? When your workforce spans from eager young apprentices and graduates seeking independence to seasoned professionals eyeing retirement, supporting everyone equally isn’t easy.

The answer lies in flexible benefits, with a broad range of options that empower employees to chart their own course to financial wellness. Here are our top 5 employee benefits for supporting your employees’ financial needs at every stage of life.

1. Tax Benefits with Salary Sacrifice Schemes

In the UK, salary sacrifice schemes allow employees to choose benefits that resonate with their individual needs, all while reducing their taxable income.

From cycling to work to embracing sustainable practices with electric vehicles, these schemes are a gateway to pragmatic savings. And let’s not forget the pension schemes and advisory services.

If you’re new to salary sacrifice, here’s how it works. Employees opt into the schemes your business chooses to offer, such as cycle-to-work. In this instance, they can select a bike up to a defined value, and the cost is subtracted from their salary monthly. Because deductions are made before tax is calculated, they benefit from reduced tax payments.

In the case of cycle-to-work and electric vehicle schemes, employees also benefit from spreading the cost of purchases – without needing to wait until they’ve saved up. So, you can support employees’ financial wellness, without costing the business.

Sound good? You can explore your options for salary sacrifice schemes in our employee benefits marketplace, or speak to one of our experts for guidance.

2. Financial Literacy: Wellness Support through Education

Knowledge is the currency of empowerment, and astute employers understand the pivotal role they play in fostering financial education.

By guiding employees through the labyrinth of budgeting, mortgages, debt management, cash flow dynamics, retirement planning and more, employers can provide the tools needed to transform financial challenges into opportunities.

Financial education can come in many forms, from online solutions to groups sessions and one-to-one advice. It’s important to choose the right options to engage your unique workforce, so they can get the maximum benefit from your support.

You can discover more about offering financial wellness support for employees here.

3. More Bang for your Buck with Retail and Hospitality Discounts

From food to fuel, prices continue to rise across the board. At best, people are putting less into savings each month. At worst, they’re cutting back on essentials.

In this climate, even small savings can help individuals and families get more out of their income. By offering a discount scheme as an employee benefit, you can help employees cut costs and stretch their hard-earned money further. There are many different schemes and solutions available, offering discount codes to use at the checkout, cashback, or discounted gift cards for everything from groceries to days out.

As prices surge, these discounts act as a buoy, ensuring employees receive optimal value for their spending. It’s more than just a discount; it’s a lifeline to financial stability.

And by hosting your benefits in a mobile app, you can keep these discounts on-hand of employees to use whenever they need them – whether they’re out shopping or browsing online.

4. Expecting the Unexpected: Income and Life Cover

Financial security is a cornerstone of wellbeing, and employers are in a unique position to safeguard it.

Income protection provides financial peace of mind, assuring employees that prolonged sickness won’t lead to financial destitution. Typically, income protection provides a percentage of an employee’s salary through monthly payments when they’re unable to work due to illness or injury. Helping them get back on their feet, without the financial stress.

Critical illness cover, while similar, offers a slightly different kind of support. This kind of benefit provides a lump sum payout in the event they’re diagnosed with a specified illness.

Life cover ensures that loved ones are financially provided for in the event of an employee’s passing. There are a few different options, such as life insurance, life assurance and death-in-service –if you’re unsure which is right for your workforce, you can speak to one of our experts for guidance.

These comprehensive measures reinforce the resilience of employees and their families, shielding against life’s uncertainties. While anyone can take these policies out themselves, they can often be costly to fund on an individual basis – so offering them as an employee benefit can further support your workforce’s financial wellness.

5. Pioneering the Path to Retirement: A Vision for Pension Planning

Empowering and supporting employees to prepare for retirement is at the forefront of employers’ responsibilities.

It’s not merely about educating employees on pension mechanics, although that is important. It’s about sculpting a comprehensive plan that promises competitive returns on their contributions. But choosing the right plan isn’t always easy, with tax relief methods, default investment funds and performances, and additional charges such as exit fees to consider. If you need a helping hand to set you on the right track, feel free to reach out to one of our pensions experts for support.

Where possible, employers can also offer above-statutory pension contributions to bolster employees’ pension fund. This not only nurtures financial wellness, but also fuels a magnetic pull, attracting and retaining a loyal and dedicated workforce.

It’s worth noting that pension planning may not be a priority for everyone. For employees struggling to make ends meet in the cost of living crisis, they might prefer to temporarily stop their contributions and receive more in their pay check to cover their essentials. So, it’s important to offer flexibility and make it easy for employees to change their preferences.

More than ever, employers should be looking for new and innovative ways to boost employees’ financial wellness. By acknowledging the diverse needs of employees and offering a spectrum of flexible benefits, you can empower employees to choose the right support for their specific needs – whether they’re looking for a new bike, worried about protecting their families against uncertainty, or thinking about retirement.

Through offering the right mix of benefit options, and making them easily accessible to employees all year round, employers can support employees’ financial goals throughout the cost of living crisis. As employees embrace their newfound financial agency, the result is a workforce empowered, resilient, and ready to conquer any challenge that comes their way.

Of course, finding the right benefits becomes more complex when you have employees in multiple countries – as their needs and local regulations are likely to vary. You can easily discover, select and rollout new benefits around the world in Eppione’s employee benefits marketplace. And instantly publish them to employees’ benefits area, for easy access and flexibility anytime, anywhere.