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07 Jan 2016

Younger workers rely on employers for financial advice more than older peers

Younger employees aged between 18 to 24 are twice as likely to seek financial advice from their employer than those in their 50s and 60s, new research has indicated.

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According to the research carried out by Baring Asset Management, 17% of younger staff members expect to receive workplace financial advice compared to just 8% of 55-64 year olds.

Chris McWilliam, principal consultant at Aon Employee Benefits, is not surprised that younger staff are looking for help to manage their finances, particularly as many of them could have debts and student loans to repay. However, he questioned the findings which suggested that older workers are less likely to seek help from their employers:

"Following the introduction of the new pensions' freedoms in 2015, our experience is that such workers are increasingly looking to their employers for assistance in understanding what these changes mean for them," he said. "Employers are therefore increasingly looking to provide targeted financial education sessions directed at specific age groups and are seeing this type of approach as integral to their ongoing reward, retention and business continuity strategy."

The research also indicated that increasing levels of UK employees across all age brackets are relying on their employer for financial education. 13% expect to receive such advice from the workplace, an increase from 9% and 7% in 2013.

But overall, financial advisers, banks and building societies and personal research remained the most popular sources of financial education, whilst friends and family were the most popular information sources for 40% of younger workers.

McWilliam commented: "Whilst it is encouraging that people are turning to financial advisers to help - even though advice costs can be a deterrent for some – turning to friends and family for advice may not always be the best source of information as they are not likely to have enough knowledge to provide more than a basic understanding of financial matters."

He added: "Employers looking to fill this gap by providing access to high quality financial education sessions on a range of subjects are seeing direct benefits of such an approach, as it improves staff morale and increases the level of employee financial literacy, which in turn improves their productivity."

This article was provided by Aon Employee Benefits.

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