Employers baulk at paying for workers’ financial advice
3 September 2018
Nearly three quarters of employers are not willing to pay for financial advice for their employees, despite recognising the benefits of doing so.
According to research by Chase de Vere and research group Lightbulb, just 27% of employers plan to include a cost for financial advice for employees in their 2018/19 budget. This was down from 36% in 2017.
Yet, the research, which covered 10,000 calls to employers around the UK and in-depth interviews with HR decision makers across 300 businesses, found an overwhelming 83% of employers felt that financial advice is something their employees would value and benefit from.
Over half (56%) said they planned to do more to help their employees make more informed choices regarding their retirement, with 33% of employers said their company would have the appetite to pay for financial advice.
However, the results showed a “significant reduction” in the number of employers who understand the benefits of financial advice, to those who have the appetite to invest in it and finally to those employers who actually plan to make provision to pay for financial advice for their employees, Chase de Vere said.
Sean McSweeney, corporate advice manager, Chase de Vere, commented: “The overwhelming majority of employers are aware that their employees would benefit from financial advice. This is a very good starting point and it is positive that more than half of employers are planning to do more to help their employees to make informed decisions.
“However, while their intentions may be good, relatively few employers are willing to spend money to help facilitate the provision of financial advice, even though they understand that their employees would benefit from it. This is disappointing because employers are well placed to help their employees. It could also be a false economy for employers.”
McSweeney warned that those employers who don’t help could over time be faced with an ageing workforce that cannot afford to retire and as a result, suffer from lower productivity, succession planning issues and losing younger talent to competitors that provide more opportunity for advancement.
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