Financial education in companies: does it work?

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Financial education in companies: does it work?

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The number of indebted people continues to grow in the country. According to National Confederation of Trade in Goods, Services and Tourism (CNC) 67.1% of UK residents families have debts. In this scenario, financial education in companies assumed an important role.

Some reasons contribute to this high statistic, among them, the high unemployment rate in the country and the unconscious consumption of the population that has the habit of making unnecessary and impulse purchases.

With the coronavirus pandemic, the tendency is for this number to increase even more, as the possibilities of credit have grown.

Despite being a good opportunity for consumers, if misused, credit can be a great villain for the financial health of families.

This is because in order to settle debts, the consumer ends up requesting payroll-deductible credit at high interest rates and gets even more complicated with the outstanding balance.

The credit card also hinders the population that makes purchases without thinking about how to pay the installments.

Without ideal planning, people are getting more and more entangled and indebted, not knowing how to pay what they owe, since more expenses are not always accompanied by more money in the account.

In the business environment, this reduces productivity and increases financial stress.

You may be asking yourself: what do employers have to do with their employees’ personal lives? The answer is almost everything.

In this article, we will talk more about the importance of financial education projects in companies and how to apply them. You will know:

  • What is financial education in companies?
  • How important is the company to change this reality?
  • What are the benefits for the company and employees?
  • How to create a financial education program in companies?

So come on!

What is financial education in companies?

Over time, companies began to realize that unhappy employees produce less than those who are satisfied and that this condition goes beyond the work environment offered. The employee’s personal situation also interferes.

If the professional is experiencing problems at home such as divorce, health issues or indebtedness, his / her work routine may be compromised.

The employee’s mood is altered and his performance is directly impacted by these events.

With the increase in the number of people in debt, the employer began to realize that this problem could reflect on the business results. It is in this scenario that the financial education in companies.

The companies’ HR sector was responsible for identifying the need to offer more than benefits directed at work. Gradually, looking at the employee as a complete human being (person and professional) became a priority for managers.

In this way, actions for employees started to include several types of training and courses, among them, those aimed at the organization of finance. Financial education programs in companies are becoming more and more present and essential.

According to the survey The Employer’s Guide to Financial Wellness, held in the United States, the fall in productivity for those facing financial problems reaches 15%.

How important is the company to change this reality?

This constant increase in UK citizens’ indebtedness has become a cause for alarm in the Human Resources departments of companies, mainly due to the impact on productivity and willingness of employees.

With that in mind, a strategy in this sector is develop programs financial education in companies, to make employees aware of the proper management of finances. They basically consist of a schedule aimed at managing the money you earn monthly.

please note that debt is not always synonymous with low wages, but rather the mismanagement of the money received. It is possible that executives with very high salaries also have financial problems.

That is why financial education in companies has a distinct role and must involve all employees of the company. More than just making employees pay off their debts, the projects aim to teach about the conscious use of money.

Lectures, courses and other actions need to think ahead and focus on planning for the future, through the payment of debts, changes in habits and investments.

To better understand the villains of lack of money, read the post: ‘8 habits of those who live without money’.

What are the benefits of financial education for companies and employees?

As we talked about earlier, financial problems and other difficulties in personal life can impact the employee’s performance at work. In addition to inattention and decreased productivity, indebtedness can cause physical and psychological disorders.

These problems can result in increased absenteeism and even discontent with the conditions (such as salary) offered by the company. In this way, the benefits of opting for financial education in companies go beyond helping employees in their personal bias.

One of the benefits for the employee is the managing your time and money, because paying for courses and using your free time for this topic is not always attractive. However, being able to use your workday to learn about the subject can help you have financial freedom.

This investment in financial education in companies then still falls on strengthening the brand, since employees see a concern of the company in their personal well-being.

Another positive point is also that often the employee ends up forcing a dismissal to use the money involved in the termination to pay debts. In this way, it is still possible for the company to present lower rates of turnover style=”font-weight: 400;”>.

How to create a financial education program in companies?

The employer or Human Resources professional who believes that financial education in companies is to offer one or the other tip to employees is wrong. The beginning of awareness on the subject must be gradual and follow an effective strategy.

To avoid making an effort that does not produce any results for employees and the company, see some tips on how to start financial education in companies effectively.

Plan before starting the program

First of all, it is necessary to identify how serious the problem is employees and understand whether these actions will have a positive impact. With this information, bring the human resources team together to define how the program should be approached and created.

It is important to make it clear to employees that the actions focus on your well-being and not just on the company’s financial results. In addition, the approach must be light and leave employees at ease to participate in activities.

Start with one-off actions

Another important tip is to start with simpler and more punctual initiatives, such as lectures on the general concept of financial education and campaigns, but think big.

Gradually, notice the support of employees and give them space to give their opinion on the idea, always listening to what they need through internal surveys, for example.

Identify the profile of employees

It is possible that the group of your employees is diverse. With indebted ones, the balanced ones, who can only pay the bills and the investors who already make small investments.

That’s why, it’s important to understand how your employees behave in this regard. Identifying the profile of each professional allows the financial education program in companies to be more assertive and achieve its objective.

Invest in denser courses and activities

After the initial process of starting to include the topic in the internal discussions, it is interesting that the company plans for larger actions. It is even possible to involve even the employees’ family members, since the household budget is made by everyone.

After the lectures on personal finance, it is interesting hire specialized consultants for personalized monitoring of each employee who is interested. Since, as we said earlier, each professional has a different reality.

Add activity dynamics about financial education in childhood, who knows, involving the children of their employees in this routine.

Loan to employees

Some companies within a financial education plan in companies consider making loans to employees by deducting a monthly amount from their wages. However, this act must be well thought out and have criteria for release.

This opportunity requires even more attention from the employee who needs to keep in mind that his monthly income will be compromised until he settles the debt with the company.

Did you like the financial education tips in companies?

The world of financial education in companies is rich in possibilities and companies that invest in these programs will certainly reap the rewards of happier and more productive employees.

In addition, it will be playing its role of raising the population’s awareness of conscious consumption in general.

It is worth remembering that the employee will not always welcome financial education actions in companies, but the tendency is to gradually realize the importance of the initiative.

Help your employees not to get into debt and work better!

To make a training program financial education in companies, it is interesting to include practical tools that optimize money management and allow more freedom in times of crisis.

Meet the proposal of HR Consultants UKy, the tool that is changing the way employees deal with their wages and generating more satisfaction and motivation at work.

HR Consultants UKy can be one of the most valued benefits for those who work at your company. Talk to an expert and learn more!

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