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30 Aug 2019

Why increasing numbers of workplaces now offer access to financial advice for employees

Increasing numbers of employers are now offering financial advice as part of their workplace benefits, according to Employee Benefits’ Benefits Research 2019. The survey of employers found that 35% currently offer their employees access to financial advice, compared to 12% last year.

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“It’s great to see that it’s becoming increasingly commonplace for workplaces to support their employee’s financial wellbeing by offering them access to services such as financial advice,” says Jonathan Watts-Lay, Director, WEALTH at work.

“Regulated financial advice can help employees understand their personal financial situation, whether they’re saving for their future, or facing investment and tax considerations,” says Watts-Lay. “It also provides individuals with added consumer protection for the advice given and can prevent them from making costly mistakes. This is especially important at-retirement when individuals are at the point of selecting retirement income options.

“After all, studies have shown that those who take regulated financial advice are more likely to increase their wealth than those who do not. For example, the International Longevity Centre revealed in it’s the value of financial advice report (2017) that, individuals age 45 and over who receive financial advice are on average £40,000 better off than those who don’t.”

Watts-Lay warns; “However, since the pension freedoms, there are concerns that individuals are making decisions about their retirement savings without taking regulated financial advice, or really understanding the consequence of them. The effects of this are that it can be easy for employees to make poor decisions and leave a permanent dent in their retirement income. For example, paying more tax than necessary, falling victim to a scammer or making ill-judged investment choices.

“Employers are increasing utilising specialist providers to put services such as financial education, guidance and regulated financial advice in place, to support their employee’s financial wellbeing. After all, offering this sort of support is an efficient way for employers to help their employees access reputable providers who have undergone due diligence, rather than leaving them to go it alone,” concludes Watts-Lay.

This article is provided by WEALTH at work

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