Employers aware of workers' need for increased pension support

More than three-quarters (79 per cent) of employers say they recognise the importance of greater support for retirement savings over the next two years, according to Willis Towers Watson (WTW).

The firm’s Future of Financial Wellbeing study found that employers were focusing on improving financial wellbeing to help employees cope with the economic fallout of Covid-19, with just over three-quarters (76 per cent) of employers stating that their employees wanted them to take a more active role in supporting their financial wellbeing.

Nearly half of companies (47 per cent) acknowledged that their employees face challenges with retirement savings, but 61 per cent were confident their retirement savings provision is effective.

Emergency savings and day-to-day costs and debt were also identified as challenging areas for employees that are not adequately supported at the moment.

WTW financial wellbeing lead, Richard Sweetman, said: “Organisations realise employees are currently facing a wider array of financial challenges and are looking to evolve from a focus on helping employees save for retirement, to adopt broader financial wellbeing programmes that provide the help they need.

“Many employers are now accelerating their focus on financial wellbeing in response to Covid-19, and the associated economic impacts.”

More than a third (36 per cent) believed that the pandemic has had a negative impact on their employees’ financial wellbeing.

Employers also remained keen to focus on broader financial wellbeing within the coming years, with around half of those surveyed intending to provide better emergency savings support and recognise the importance of debt and day-to-day costs support.

Sweetman commented: “Debt and the ability for employees to make ends meet should be a particularly important area for employers to focus on, with almost a quarter of employees seemingly affected. We know from employee research that when these issues do come up, they have a particularly detrimental impact on mental health and wellbeing.”

Around half of the surveyed employers said they were looking to introduce at least one additional type of workplace savings option within the next two years, while more than half already offered their workers online educational resources.

Sweetman stated that employers now face the challenge of “how to design and deliver a successful programme”, as research had shown that “simply providing more options to employees is unlikely to be successful if it is not supported by effective communication and decision support”.

He concluded: “A well-structured financial wellbeing programme will not just provide tools and apps but also coaching, seminars and guidance for employees, to help them make better financial choices. To be most effective, programmes need to relate to individuals’ circumstances and be communicated at moments in time most relevant to the employee.”

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