Helping Your Team Members Pay Off Their Debt Faster
We tend to think that debt is something that happens to people who don’t have regular jobs. Their furnace packs up or their car breaks down and they suddenly find themselves having to take out expensive credit to cover their costs.
But, in reality, that’s rarely the case. It is actually regular employees with steady paychecks who are at higher risk of running up unsustainable debt. Unlike those with irregular incomes, lenders are more likely to approve them for credit, allowing them to get into much more serious debt spirals.
Debt isn’t just a personal problem, either. It can cause many problems at work, including lower productivity, a lack of focus and even emotional issues.
In light of this, employers need strategies and approaches that they can use to help their colleagues pay off debts faster. So what, precisely, can you do as a business owner?
Teach Them About Finances
The first thing you should do is teach them about finances. As surprising as it may sound, only a small minority of employees know how to manage their money correctly. For instance, employees may still need to learn:
- How to save and how saving forms part of a healthy approach to financial life that will help them live better in the future
- How to budget. Many people do not understand how to balance their income with their expenditure
- How to approach debt itself, and how there are both good and bad forms of borrowing
- How investing can help create a financially secure and stable future, and how it generates wealth over the long-run
You may understand these issues as a business leader, but don’t assume that your colleagues do too. They may not have a clear grasp, for instance, of what investment is, and why it’s important. They may also struggle to make a connection between the financial actions they take today and their ability to enjoy their lives in a decade’s time.
Enlist Help from Financial Seminar Businesses to do Workshops
Teaching your colleagues about finance may sound like a good idea in principle. But as a business leader, you may not have the time to personally address the issue. What’s more, if you do, you may appear to be intruding too much in their personal lives.
Workplace financial counseling will help you address both these issues. Financial literacy programs run by third parties can help your colleagues with issues, such as debt, while also maintaining their privacy.
Employee financial wellness programs typically arrange themselves around four pillars: credit building, debt management, better budgeting and smart banking.
Better budgeting helps employees build a roadmap to financial success showing them what they could achieve with consistent, deliberate effort in the right direction.
Smart banking shows which banking tools can help them get closer to their goals.
Credit building reduces the prices of taking on new debt. And debt management introduces employees to the tools that they can use to reduce their overall interest payments.
Ultimately, investing in financial literacy for your colleagues reduces money worries and helps them become more productive at work.