According to the TUC, the average British household debt has reached a record high with almost £15,400 owned to credit card firms, lenders and banks. At the brink of uncertainty – which can be primarily blamed on the Brexit process for now – and a localised economic crisis, it’s fair to say that Britons are at risk of aggregating even more debts within the next few years. As of today, over 6 million Britons think that they will never be debt-free. What is surprising about it is that most of these people have a career and a regular income. Perhaps it is time for companies to consider how they could support their employees through a difficult debt situation.
Debts are stressful
First of all, it’s crucial for businesses to understand that debts are not to be taken lightly. It’s an extremely stressful situation for employees and their families. Even though many are willing to clear their debts as quickly as possible, there are only so much one can do to manage the household budget. Unfortunate decisions and the inability to cut back on spending – which is often the result of a lack of understanding as well as a personal crisis – stand in the way of healthy finances. More importantly, the stress accumulated in the process can also affect the employee’s productivity and attention at work. In other words, it’s in the company’s interests to provide financial guidance and support.
As a business, you have a responsibility to protect your employees
When you hire an applicant, you agree to offer the employee a safe and enriching workplace while they bring their skills into the company. Admittedly, for most businesses, the idea of providing a secure platform for employee development is often limited to health and safety audit and compliance. https://www.qcompliance.co.uk/services/health-safety/ However, you need to think outside the box and consider all the factors that can affect the performance. Financial worries are one of these, especially when they can’t be prevented. Consequently, it’s a good idea for businesses to offer dedicated health protection and even relevant life policy cover – you can find out further information about what relevant life policy means and why it matters for your workforce – to provide the necessary support. An employee who is unsure how to provide for their family in an unexpected situation may feel as if the company has given up on them.
Offer financial perks
Managing money matters can be challenging for people who are not trained in finance and accounting. But facilitating financial information and decisions can not only make it easier for employees to manage risks and profits, but it also ensures the employee engagement. Indeed, someone who feels that the company is contributing to their debt management by making financial advisors available on-site is more likely to stay with the business. Additionally, by reducing the risk of poor decisions and lack of knowledge, companies can actively help the British public to remain debt-free.
British households are facing a grave economic crisis. But, for many, with over £15,000 debt, there is no way employees can handle the uncertainty of their financial future. It is a business priority to consider how to help employees with finance management and health crisis in an effort to reduce the collective debt.