The dos and don’ts of using data for financial wellbeing communications
Although data is invaluable for financial wellbeing communications, the personal nature of this topic means it must be used carefully. These dos and don’ts can help you use data effectively in your financial wellbeing communications.
Do use life events
Life events such as getting married, becoming a parent or moving home are all worth celebrating, but they’re also times when an employee might need to review their finances. With the additional responsibilities of a spouse, child or a larger mortgage, it’s a good time to flag up benefits such as life insurance, critical illness cover and will writing services.
Do link to pay rises and bonuses
Also worth celebrating, a pay rise or bonus is a good time to flag up the financial planning opportunities an employee can take advantage of with the extra income. Perhaps they might want to take out additional benefits, increase their savings or pension contributions or sacrifice their bonus into their pension. Likewise, as pay increases, it’s worth highlighting how much more is going into their pension in employee and employer contributions.
Do analyse benefit data to identify possible issues
Drilling down into benefit take-up data can reveal some unusual employee behaviour. For instance, if someone decides to opt out of the pension, shunning their employer’s contribution, it could be down to the fact they’ve already reached their lifetime allowance. But it could also be because of a lack of understanding or a debt issue – both of which would benefit from some additional support.
Do target salary levels where action may be needed
Employees earning just over £50,000 or £100,000 can find themselves caught in a bit of a tax trap. For those nudging over £50,000, it will affect their Child Benefit, while an employee over £100,000 will see their personal tax allowance reduced at the rate of £1 for every £2 they earn.
Alerting them to these tax traps can enable them to take steps, such as paying more into their pension or giving to charity, to reduce their income.
Do keep it anonymous
Finances are personal and not every employee will want to discuss their spending habits with their employer. To encourage them to reach out for support, highlight the confidentiality of services such as your employee assistance programme.
Don’t make assumptions
Although some employee data can provide great opportunities for more personalised financial wellbeing communications, it’s important not to make assumptions. Anyone can find themselves facing financial difficulties, regardless of age, income or seniority, so be careful when sending out communications based on these criteria.
This article is provided by Legal & General.
Supplied by REBA Associate Member, Legal & General
One of the UK's leading group protection providers with over 85 years' experience.
