Financial worries negatively affect productivity
Employers have a key role to play in countering financial exclusion among the UK workforce, according to a report by the House of Lords Select Committee on Financial Exclusion.
The report said employers have a direct interest in the financial wellbeing of their staff. It cites research suggesting 70% of UK employees admitted to wasting a fifth of their time at work worrying about their finances and at least 17.5 million working hours are lost each year as a result of workers taking time off due to financial stress.
The enquiry by the committee sought evidence from the government, regulatory, industry and third sector sources on the cause, scale and solutions to financial exclusion.
“We have been told that the workplace offered an ideal opportunity to continue financial education, noting that employers have a direct interest in the financial wellbeing of their staff and were partially responsible for continuing professional development. They went on to suggest that employers could add financial literacy to company induction and training programmes,” the committee said.
Excerpt from Health Insurance Daily, read the full article here
Don’t over commit
Bills are a fact of life; they only become a problem when you become over committed. Over committed means that your income can no longer meet the bills coming in.
By careful budgeting and planning and by being realistic about what you can afford, you can avoid debt problems and make the most of your income.
It’s easy to become over committed
It is easy to become over committed; every time you sign up for a new service (e.g., pay TV, gym membership, or a mobile phone contract for example); or buy something on hire purchase; or add to a credit card debt, you add to your monthly commitments. Likewise it can sometimes be all too easy at Christmas to buy now and pay later only to get a huge shock in January when the bills or credit card statements come in.
Review your budget
A personal budget can help you to plan ahead and make the most of your money. It would be beneficial to calculate your regular income and identify all your spending commitments. Taking a little time to plan this out over the next 3-6 month period will be time worth investing. By working out a budget you’ll know how much money you have for essential living expenses and how much you can afford to commit to other plans, for example buying a car, taking out a new mortgage, going on holiday or saving for the future). Once you have set yourself a budget it is important to review your budget on a regular basis, because your circumstances are likely to change. In the early days it also helps to keep a check on things on a weekly and or monthly basis to make sure you are keeping to your plans and preparing ahead if you think problems are likely to arise in the near future.
Prioritise your commitments
A budget will help you to priorities your commitments to make sure that your basic needs and financial commitments are met. You can then you can decide what else you can afford, and what you may have to save for, or do without. Remember a budget is just a plan. You need to regularly review your plan so that you can adapt how you manage your money should unexpected expenses arise, or should you receive unexpected income. If you are over-committed and have a debt problem, don’t ignore the situation.
Signs you may have a problem include:
- Having rent or mortgage arrears
- Taking out new loans to pay off old ones
- Only paying the minimum amount on your credit card each month
- Using a credit card for day to day purchases
- Ignoring letters from creditors
By listing and prioritising your debts, developing and implementing a personal budget and talking to your creditors you may be able to sort out any issues you may have. Always consider seeking the advice of an Independent Financial Adviser as they can help you to manage your finances.