Introducing Make The Most of Your Money

Transcription

1 Introducing Make The Most of Your Money Workplace Financial Education Stuart Bailey, Manager, Financial Capability Workplace Tel: Mobile:

2 Programme Background Importance of Workplace Financial Education Programme offered by FSA Results so far 2

3 Background Surveyed 5,300 people via in-depth face to face interviews. Findings led to a call to action to develop a strategy to improve the nation s knowledge and understanding of personal finance The seven-point programme will reach 10 million people by 2011 of which 4 million will be reached at work 3

4 Background The Challenge Many people are failing to adequately plan ahead A small proportion of people have debt problems, but they are often very severely affected People do not take adequate steps to choose products that meet their needs The under-40s are less capable, on average, than their elders 4

5 Why Financial Capability is important An inability to agree on the way a couples finances are run is now the second most common reason for divorce after adultery Times 8 th March another study in the same week by The Samaritans reveals money has now overtaken work as the leading stress factor in our lives Times 8 th March million people have not joined their occupational pension arrangement. Department Work & Pensions

6 Our programme of action Schools Workplace Online Tools Young Adults New parents Consumer Communications Money Advice 6

7 Value of financial education at work For the Employee.. Better understanding of personal finances Improved awareness of employer s reward package, Financial worries reduced Increased ability to understand financial products and terms Motivation to shop around thus saving money For the Employer.. Extra Benefit - helps make the right choices at induction, retirement, share plan maturity, Enhanced awareness of employer s reward package Staff stress reduced, impact on absenteeism, staff retention Positive results from staff surveys 7

8 Financial Education and Share Plans To support share plan launch Options at maturity SIP SIPP Eggs in one basket Share plans as part of long term wealth management 8

9 Supporting financial education Links to online tools Employee literature Disks Seminars 9

10 Borrowing Annual Percentage Rate 10,000 over 5 years APR 7.5% Monthly repayment of Total repayment 12,022 APR 15% Monthly repayment of ,251 MORE! Total repayment 14,273 10

11 Saving & Investing Result of regular saving Saving 20 every month for 5 years With interest at 5% you could have around 1,300 Saving 50 every month for 5 years With interest at 5% you could have over 3, a month = less than 1 a day = less than a coffee! You may be able to avoid tax on your savings 11

12 Retirement planning Before retirement Tax relief Pension contributions At retirement Lump sum (Tax free) Regular income (taxed) Mortgage - utilities food holidays healthcare 12

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14 How Employers are using the FSA service Additional stand alone benefit Communication for new benefit/pension offering Linked to a move to a more flexible benefits offering Share plan launch/maturity Training course/induction Linked to annual rewards/pension statement Linked to generic benefits communication 14

15 FSA Support Dedicated Relationship Manager Communication programme Promotional material Brochure ware Experienced presenters accredited by FSA Feedback & evaluation 15

16 Cost Commitment & time Following costs met by FSA: Literature Evaluation Promotional material Discs Presenters 16

17 Success so far Already reached over 600,000 employees Quality of our programme is regarded as high by all parties. Content pitched at the right level by 90% of employees. 70% of employees felt seminar had improved knowledge of understanding money issues 82% of attendees intend to take action 3 months later 60% of attendees taken action or intending to. 17

18 Introducing Make The Most of Your Money Workplace Financial Education Stuart Bailey, Manager, Financial Capability Workplace Tel: Mobile: