Understanding all of the options is funDAMental to making the right financial decisions.
Workplace Financial Education sessions ensure your employees make informed choices.
Thanks to the April 2015 pensions changes, the UK is in the midst of not only the most important period in the history of pensions, but also one of the most confusing.
The pensions changes of April 2015 will have a major impact on almost all UK savers, as they are presented with more retirement options than ever before. The extra choice is welcome, but also brings dangers since making the wrong decision could be costly and - as is often the case – it is employers who are expected to provide the pension education to ensure their staff make the right choices.
80% of HR Directors believe their employees will expect their employer to provide financial help, which is why it’s worth having a discussion about the hows and whys of DAM’s Workplace Financial Education sessions.
How do DAM’s Workplace Financial Education sessions work and cost?
It might sound obvious, but the “workplace” part of these financial education sessions means that we will actually come out to and conduct the education on your own premises. Not all providers of financial education actually come to your own premises, but we know from experience that this is the most effective way to explain the various retirement options.
Once there, our consultant will give an overview of the new pension rules and what they mean, the retirement options available for savers and the most important rules associated with each. We will also cover the most common mistakes that savers could make when deciding what retirement package is right for them.
Following that talk, our consultant will speak face-to-face to any employee looking for some specific retirement advice and can give a more detailed explanation of each individual’s specific options – the part of the session which employees are most grateful to their employer for and most appreciate.
In terms of the cost, the great news for employers is that the sessions are relatively cheap compared to other employee benefits. Depending on the company, the cost of a DAM Workplace Financial Education session ranges from £500 to£750.
The fact that staff appreciate these education sessions so much makes the engagement-to-cost value for the employer a real bargain. Just recently, we have started to provide these sessions to one of our biggest clients- the Dorechestor Collection- take a look for yourself!
Why should employers provide financial education in the workplace?
For HR departments, financial education in the workplace is becoming more of an expectation than a luxury. A recent Barclays study found that nearly 2/3 of all employees seek financial education and guidance, particuarly Gen Y as 65% claimed they would value financial education despite a mere 17% claiming this was currently available to them. It would take a brave HR Director to continue to ignore such demands.
For those employers that are already providing workplace financial education, the value is obvious. 73% of staff receiving such education on pensions have said that they feel more engaged with and positive about their employers. If turnover can be reduced through the provision of financial education in the workplace then this is a great – and relatively inexpensive – new employee benefit that employers can use to earn respect and loyalty from their staff.
Employee wellbeing is so often mentioned when it comes to discussing priorities for employers. Businesses which provide a generous workplace pension offering for their staff are providing that crucial first step for ensuring a comfortable retirement package for employees. Failing to provide the second step – the advice on how to maximise the potential of those big pension pots – undermines employee wellbeing. Smart employers are putting as much emphasis on that second step as on the first.
But doesn’t the government take care of educating savers?
Quite simply, no. It doesn’t.
The government has guaranteed a “guidance” session for all retirees and these will be provided by the Citizens Advise Bureaux or The Pensions Advisory Service under the name “Pension Wise” These will not, however, be nearly as effective as a financial education session in the workplace and will only be available to savers over 55 whereas a financial education session benefits all your staff.
Employees simply want the new pension reforms explained, but the guidance sessions will only be able to quickly outline what the various options are and not in very much detail.
Crucially, the guidance sessions the government offer WILL NOT be able to give proper financial advice. Only a FCA regulated adviser can do that, which is what makes DAM’s workplace financial and pension education sessions so valuable. In other words, the government guidance sessions can tell savers what their options are; the sessions run by DAM can tell savers which of those options is best for them.
Employers appear to agree that the government’s Pension Wise guidance won’t quite cut it for employees, with 51% of employers admitting they do not trust the service. That same group of surveyed employers were asked who they thought employees would hold responsible if poor decisions were made. 48% of employers believed that they would get the blame from staff in such a scenario.
That’s what employers are looking to avoid and in order to maximise employee wellbeing, employers appear keen to provide a more substantial retirement planning alternative to Pension Wise for their employees.
How can I find out more about DAM’s Workplace Financial Education sessions or book one?
Whether you are already thinking of dates for a workplace financial education session or you still have any doubts or further questions, you can give us a call at DAM on 0141 222 2045 or email us at firstname.lastname@example.org and you’ll be able to speak to one of our team about financial education.
One of our consultants can even talk you through the financial education process in more detail and cover everything you may want to know, from what equipment we bring with us to how early we can start or how late we can finish our sessions.
Then you’ll be able to offer your employees financial education in the very near future, winning plenty of employer brownie points in the process!