5 benefits that help boost employees’ financial muscles
With the average UK salary at around £34,000, according to Statista, many people are precariously close to the £30,000 threshold that the Joseph Roundtree Foundation says is required for a decent standard of living.
During the winter, high inflation forced people to cut non-essential spending, as well as reduce energy use and limit leisure activities.
As a resut of the cost-of-living crisis, financial worries are consistently among the top stressors, and with employees forced to stick to tighter budgets, they’re looking for ways to save money and make their pay go further.
Employers must find affordable ways to support employees, helping them face rising costs, manage debts, and support their wellbeing.
Here are 5 benefits that support employee financial resilience:
1. Discounts platforms
Discounts and cashback schemes offer a practical means for employees to stretch their pay further. Employees can save on both significant purchases and routine shopping, requiring minimal behaviour change.
Often overlooked, discounts platforms provide savings on big name brands. For instance, employees can save £250 on a Sainsbury’s shop annually.
2. Benefits that help employees save
Providing access to affordable credit is a meaningful way to help employees get control of their finances. Salary sacrifice loans and pay saving schemes are a great way to do this – automating payments and allowing employees to consolidate dept, often at a better interest rate. Salary saving schemes can help employees develop better savings habits as contributions are taken from payroll.
Some companies are even starting to offer interest-free loans – helping employees to pay for commuting expenses or rental deposits, particularly in costly areas like London.
Salary sacrifice benefit schemes can also help employees cut costs (due to National Insurance savings) and allow employees to spread the costs over 12 months. Salary sacrifice electric vehiicles, cycle-to-work schemes, technology, gym memberships, or cinema passes, for example, allow employees to get a better deal and spread payments.
3. Benefits that protect employees from risk
Benefits play a vital role in safeguarding employees and their families against key risks, which is especially important in an inflationary environment where finances are stretched. The most advanced benefits programmes help boost employees’ confidence in financially planning for and coping with financial pressures and challenges.
Income protection, though often misunderstood, is an important insurance product that protects employees from being unable to work through illness – and almost always pays out. And giving employees access to critical illness cover also enables them to gain from the tax benefits that salary sacrifice can offer.
Through a benefits provider, employees can save up to 54% on the cost of buying cover as a standalone product through a direct provider.
4. Healthcare benefits and insurance
Health cash plans reimburse employees for everyday health expenses and provide a great return when used to their full potential.
Employees can choose cover levels that suit their needs: The two most claimed benefits are optical and dental treatment, and claiming for these two alone would typically exceed the cost of the cover itself.
Health cash plans also cover expenses for chiropodists, podiatrists, osteopaths, and physiotherapists. This encourages employees to keep up routine checkups that they may have put off due to tighter budgets. Private medical insurance is also highly valued by employees and often comes with supplemental services like a 24/7 GP service.
5. Mood-boosting benefits
Despite financial constraints on their disposable income, people want to maintain enjoyable, fulfilling lifestyles, particularly when it comes to travel, making up for time lost during the Covid-19 pandemic. As a result, mood-boosting benefits have grown in popularity. These experiences provide people with memories and opportunities to relax and recharge – for example, employees are opting for luxury spa days, days out, hotel stays and meals.
Employee benefit schemes should include access to positive experiences that give employees things to look forward to and plan for, offered affordably through discount schemes and salary sacrifice.
Setting employees up for financial success
These five benefits go some way in supporting employee financial resilience – and, supported by the right communication strategy, can help organisations foster a positive culture of financial wellbeing.
To learn more about how your benefits toolkit can support your employees amid high costs, download Benefex’s Cost-of-living Crisis Special Report.
In partnership with Benefex
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