How has the cost-of-living crisis impacted saving for retirement?
The ongoing cost-of-living crisis has affected people in a multitude of ways, from everyday items increasing in price to inflation rising. The crisis is also having an effect on businesses and their employees, with many more feeling the squeeze. With this in mind, it’s important to look at how employees who are saving for retirement have been affected, and what measures businesses can take to look after them.
How the cost-of-living crisis is affecting retirement plans
The economy has been in a difficult place for the last few years, thanks in large part to external factors such as the COVID-19 pandemic and the war in Ukraine. Though it’s still early in 2023, the economy is showing few signs of recovery.
Unsurprisingly, the current economic environment is having an impact on workers, with surveys showing that many are worried about their finances.
This fear is having a big effect on retirement plans, with more workers planning to delay their retirement due to money worries. While many are still investing in a retirement fund, higher bills in 2023 could lead to a significant reduction in pension spending, with more workers prioritising being able to afford essential everyday items over saving for retirement. According to a recent survey, many workers have reduced the amount they’re contributing to their pension scheme over the last 12 months, with more planning to do the same in the coming year as energy prices look set to increase.
How businesses can help employees during the cost-of-living crisis
The ongoing crisis has led to a reduction in the amount of pension funding and a general anxiety among employees, but there are a number of cost-effective ways that businesses can help their workers. These can range from smaller benefits, such as free parking and meals, to larger policies that can make a big difference to your employees’ financial wellbeing.
One such method is Group Life Insurance. This allows businesses to cover all of their employees under one insurance policy, which pays money to the beneficiaries of employees in the event of their death. This payment takes the form of either a fixed lump sum or a multiple of the employees’ salary. This policy often comes with access to apps that can help with physical and mental health, including 24/7 virtual GP appointments for employees and their families. This policy is paid for by the employer, so employees do not have to pay anything in to get the benefits. With workers increasingly unsure about contributing into a pension fund, a group life insurance policy can help ease their financial fears.
As the cost-of-living continues, implementing policies such as Group Life Insurance can have a big impact on your employees’ physical and mental wellbeing. Polices such as these can give employees peace of mind, safe in the knowledge that their loved ones will be well looked after should anything happen to them.
While the cost-of-living crisis is affecting businesses and employees alike, implementing policy such as these can go a long way towards helping your employees through the worst of it, keeping them healthy and productive and looking after their loved ones.