Business & Finance

Financial Wellness in the Workplace

Economic times are tough for both Employers and Employees alike. 2012 was a year where we witnessed increased and more widespread violent strike action. From mining to transport, to textiles and to farming, many industries have been hit by strike action. Arguably there is the debate about minimum living wages and living conditions, writes Nigel Willmott, CFP® professional.

Some of these arguments may carry some merit but one of the issues at the heart of the dissatisfaction amongst many workers is that many of them carry massive personal debt burdens.

This increase in personal debt has crept in over time. Many people nowadays fund the difference between income and expenditure “with a little credit”. Many people believe that they cannot get by without the help of credit. In many cases this is not true. It starts with us – as a nation we need to review how we manage what we earn. We need to consider carefully where and how we spend our money.

We need to get financially well again. To make sense of our attitude towards money and how we use money we need to get financially educated. This is where employers can and should play a major lead role in assisting their staff to become financially literate and financially independent.

As we have seen with the strikes of 2012, strike action can be crippling for the country and for business. Financial wellness in the workplace is thus a priority and is a “bottom line issue” of crisis proportions.

A financially distressed workforce can lead to:

  • Theft and Corruption;
  • Rampant garnishing orders;
  • Advancements on salaries and wages;
  • Turning to loan sharks for unsecured debt;
  • Employers can become lenders of last resort;
  • Problematic and difficult salary/wage negotiations;
  • Attempts to access company retirement fund money;
  • Financially stressed staff can become difficult to manage;
  • Unstable workforce and high staff turnover as employees are hunting for better paying jobs.

Employers can take the socially responsible lead in South Africa and assist their staff by implementing a financial wellness programme. Through this financial wellness programme employers should primarily focus on three essential personal financial life skills:

  1. Managing your Money by teaching people to set up and implement a personal monthly budget planner
  2. Making sense of your Debt by understanding how debt works and how to take steps to reduce personal debt levels
  3. Understand Savings and Investments and set Short / Medium and Longer Term Financial and Life goals.

These three “pillars” are the key to financial freedom. Employers can help their Employees to take back their financial freedom and live financially independent. At motivate | today we can help employers tailor and implement a financial wellness solution to suit both the employer and the employee financial wellness needs.

Nigel Willmott CFP® is the Managing Director of motivate | today, an independent holistic financial life skills company focused on the financial education needs of employer groups, universities and schools.

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