Is it an employer’s responsibility to invest in the financial education of their staff or is this a skill that they should naturally develop on their own?
With the 2022 National Budget speech around the corner, this was a topic that came up in a recent discussion and it drew some interesting discussions from around the table.
On one hand, some employers viewed money as a very personal topic and didn’t see a benefit in investing in financial education initiatives or establishing a financial wellness offering for their team.
Others believed that there was very limited financial education being offered as part of the traditional school criteria in South Africa and poor money habits were spilling over into the workplace.
We believe that allocating time to financial education initiatives can provide a big boost to productivity and here’s why:
Demystifying financial problems for your staff
Money is indeed a very personal topic but financial stress is also linked to feelings of loss of control, anxiety and in turn leads to workplace absenteeism and decreased productivity. The workforce of the future can’t function at maximum efficiency if they are constantly stressed about money.
We were fortunate enough to sit in on a recent financial education session inside of an NPO which has a relatively young and image conscious workforce. One of the “Ah ha!” moments came when an older staff member explained how the financial stress of COVID had seen him having to downgrade his car from a high-end BMW to a Kia.
When they could see an older staff member being open around the financial situation, the entire group suddenly became more engaged about their own vulnerabilities.
This wasn’t a case of pushing Financial Education or a tool onto a resistant workforce – this was just a case of demystifying the world of money.
Setting a platform for wage and salary discussions through financial wellness
As the South African economy is starting to switch on again, we can start to get a clearer picture around the state of household finances and it is clear that the recovery won’t be easy.
In January Transunion released its “Quarterly Transunion Consumer Pulse” survey and it showed that 34% of surveyed consumers had reported that somebody in the house had lost their job with the lowest income earners struggling the most.
This leads to a natural tension between employers and employees with many staff now pushing to try and recover earnings lost in the last few years and employers adopting conservative approaches to increases.
A regular criticism of organized labour organisations is that they are pushing for above-inflation linked annual increases and businesses simply can’t afford it.
By investing in the financial wellness of your team and introducing regular financial education sessions into their working week, you can put these discussions front-and-centre rather than wait for the annual salary reviews.
Turning staff into business owners through financial education
While there is still a lot of work to do – one of the quiet revolutions taking place in the South African market right now is the growth of a retail investor base courtesy of the work that the team from EasyEquities are doing.
Traditionally the idea of investing in businesses and property have had limited adoption but EasyEquities now have over 1 million investors on their platform and this is a driving a shift in behaviour where people are seeing themselves as owners of businesses and not just employees.
Financial Education or Financial Wellness initiatives don’t need to be prescriptive – there is no “one-size-fits-all” solution and each staff member will be different but as a business you can create an investor / owner culture quite quickly.
One of our clients gives each new staff member who joins their business an EasyEquities voucher and they gamify internal challenges like product development, sales targets or team-building sessions with EasyEquities vouchers. This creates a great internal vibe to talk about money and investing in a non-threatening manner.
If you are interested in building a financial education solution for your staff then please do not hesitate to contact us.
If you are interested in learning more about how EasyEquities works, the below video provides a nice explainer for you.
South African households have been under so much financial pressure for the past of couple of years and it is taking a mental and physical toll on the workforce.
By investing in the financial education of your staff, you can alleviate some of this stress.