29 Jan 2020

Future-proofing your workforce: the right tools to support life-changing financial resolutions

It’s natural for employees to rethink their lives in January. This time of year is viewed as a clean slate. A time to set new goals, start diets, join the gym, sort out finances or make bigger changes in life.

It’s a time for planning the future. This January in particular is likely to be even more poignant given that many employees will have delayed making major decisions thanks to the social, economic and political uncertainty around Brexit.

But, by January 31, Brexit will be done (potentially!), which may mean we see employees having the confidence to make bigger decisions around their future too.

Of course, not all will be easy changes to make. Divorce enquiries traditionally hit a peak in January after the stress of the Christmas break for those with already strained relationships, and living arrangements will need to be rethought. January is also a peak time for employees to start looking for new jobs. Is it any wonder all this stress leads to the very real phenomena of the January Blues?

Underlying all this can be the worry of finances. Employees may have debts, exaggerated by the Christmas splurge, that they want to get under control to prepare for something special; such as a child’s wedding or university education they want to release cash for; or planning new beginnings – such as getting on the property ladder, upsizing or downsizing.

Give staff the tools they need

Doing all you can to ensure your staff are not distracted by such big decisions and to support them in their new year’s resolutions, is key. Offering them the tools they need to secure their future finances could help boost staff’s mental wellbeing and improve productivity but also, longer term, may help you retain them too.

Offering in-house, free mortgage advice can be a key component of a financial wellness package that employers can offer to staff. Those looking to invest in property can be given help and advice to find the right deal for them to achieve their dream.

According to figures from the Yorkshire Building Society, the number of first-time buyers in 2019 was at its highest rate since 2007, thanks to competition driving mortgage rates to near-record lows, as well as schemes to help people buy. That number is likely to increase further in 2020, once uncertainty around Brexit ends and decisions are finally made. To make the best choices, staff will need support from mortgage professionals.

Supporting long-term financial decisions

Meanwhile schemes such as the First Homes initiative, announced in the Queen’s speech in December, which offers first-time buyers the chance to purchase a home in their local area at up to a 30% discount, could also help boost purchases.

Other staff could be saving thousands of pounds a year by fixing their mortgage deals if they have unwittingly slipped onto their lender’s standard variable rate, something that will definitely help in sorting finances.

Thanks to low rates, increased competition and longer term deals, the opportunity to commit to longer-term certainty is available. Recent research from Moneyfacts, says that the number of low LTV (loan to value) five year mortgage products is now greater than the number of similar two-year offerings. This is also good news for those who may worry about longer term economic conditions.

It seems that more people than ever are ready to commit to home ownership, but they need independent advice to get the best products while those who are wanting to overhaul their finances can sometimes overlook their mortgage. As their employer, you can help them in those longer-term resolutions – and they may well thank you for it.

This article is provided by Charles Cameron & Associates