Financial wellbeing week - the importance of financial education in the workplace
UK households are 'worse than at any time on record' spending around £900 more on average than they receive in income each month.
With online shopping having become the top choice for many, this has created ample opportunities for consumers to use and overextend credit – an all-too-easy way to accumulate debt - and fast - as major retail brands such as ASOS and Very offer shoppers the opportunity to ‘buy now, pay later’.
And with a rise in financial products available from, savings and investments to debt management solutions, it’s becoming far more difficult for consumers to understand the best route for them to take.
Indeed, the growing sophistication of financial markets means consumers are not just choosing between interest rates on two different bank loans or savings plans, but are rather being offered a variety of complex financial instruments for borrowing and saving, with a large range of options.
And whilst people have always been responsible for managing their own finances on a day to day basis – spend on a holiday or save for new furniture; how much to put aside for a child’s education or to set them up in life – it’s clear that recent developments have made financial education and awareness increasingly important for financial well-being.
Of course, this is not to say that all consumers should have a detailed understanding of structured investments or the stock market – after all that’s why we’re here – but through gaining a basic understanding of the main financial products and different opportunities available for borrowing, saving and investing this will help to ensure individuals are able to make more savvy choices. For example, through understanding the different types of credit available, consumers can make a more sophisticated choice that will not only help to minimise charges, but also increase their credit rating and make it easier to purchase a mortgage.
The financial education sessions we offer members at DAM for example provide employees with very basic information on some of the main financial products available to them, as well as the opportunity for individuals to gain more specific information on their personal circumstances.
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