- EMPLOYEES FEEL THEY NEED £361 EXTRA INCOME A MONTH IN ORDER TO SAVE MORE
- SELF-CONTROL, LACK OF KNOWLEDGE AND PERSONAL CIRCUMSTANCE ARE THE TOP THREE FACTORS LIMITING BRITONS’ CURRENT SAVING LEVELS
- 1 IN 5 HAS A HOUSEHOLD INCOME <£30K AND ARE RENTING OR LIVING WITH FRIENDS
- AFTER FRIENDS & FAMILY, EMPLOYERS ARE THE MOST TRUSTED GROUP WHEN IT COMES TO FUTURE FINANCES AND ARE UNIQUELY POSITIONED TO HELP EMPLOYEES IMPROVE THEIR FINANCIAL WELLNESS
UK employees think they need £361 extra income each month to save more, according to new research by JLT Employee Benefits (JLT), a leading employee benefits consultancy in the UK. This equates to a national savings gap of £9.7bn* per month.
JLT’s findings indicate that self-control, lack of knowledge and personal circumstance are the top three factors limiting Britons’ current saving levels, marginally outweighing trust and upbringing.
The report concludes that employers are well-positioned to help their workers take steps to improve their financial wellness. Beyond family and friends, JLT research shows that employers are the most trusted port of call for assistance and guidance around future finances, ranked ahead of pension providers and the government by those surveyed.
One group, identified by the research as high-risk, is particularly in need of renewed support around saving and broader financial wellness. This group comprises the 20% of UK workers currently earning less than £30,000 a year (9% earn less than £20,000) and renting or living with friends.
Commenting on the research findings, Nick McClelland, Director at JLT Employee Benefits, said:
“Our findings demonstrate the scale of Britain’s savings problem. The perceived need for an extra £361 a month cuts to the heart of the dilemma. However, the answer to this problem is a not a pay rise for British workers – this isn’t feasible. Rather, we need a mindset adjustment from all stakeholders.”
Personality not income drives propensity to save
Contrary to received wisdom, the research found that neither age, nor household income is directly correlated with the propensity to save. Instead, JLT research demonstrates that saving behaviour is heavily influenced by personality traits, particularly neuroticism – driven by impulsive decisions, social anxiety and sensitivity to distress – and conscientiousness - motivated by deliberation and a need for order.
Current pressures on income are the most significant determinant of financial wellness across all age cohorts. Younger age groups identified knowledge as the next most important factor in determining their financial position, while older groups said their saving habits are more goal-oriented.
Nick McClelland added:
“For too long stakeholders and the media have tried to label low saving levels in the UK as a generational issue – the outcome of a ‘millennial mindset’ – failing to acknowledge that this is a much broader question of education and support.
“Employers are uniquely positioned to step in and help their employees reassess their financial wellness. Helping employees to feel more confident about money and helping them to talk openly about their financial situation is the first step. It’s time to start talking to your employees about the things that matter to them.”
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JLT Employee Benefits
PR Manager, JLT Group
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NOTES TO EDITORS:
*Britain’s £9.7bn savings gap has been calculated using the most recent ONS figures on private sector employment. In December 2017 there were 26.9 million people employed across the UK private sector. On the basis that, on average, employees feel that they need £361 extra income each month in order to save more, this number aggregates to £9.71bn per month.
About Jardine Lloyd Thompson
Jardine Lloyd Thompson is one of the world’s leading providers of insurance, reinsurance and employee benefits related advice, brokerage and associated services. JLT’s client proposition is built upon its deep specialist knowledge, client advocacy, tailored advice and service excellence.
JLT is quoted on the London Stock Exchange and owns offices in 41 countries with more than 10,600 employees. Supported by the JLT International Network, it offers risk management and employee benefit solutions in 135 countries.
For further information about JLT, please visit our website www.jlt.com.
About JLT Employee Benefits
JLT Employee Benefits is one of the UK’s leading employee benefit providers offering a wide range of benefit and pension services, including administration, actuarial and pension consultancy, investment, Self Invested Personal Pensions (SIPPs) and Small Self Administered Schemes (SSASs) administration, flexible benefits, healthcare, benefit communication and financial education.
Pensions and employee benefits companies within the JLT Employee Benefits group of companies include: JLT Benefit Solutions Ltd, Profund Solutions Limited, JLT Wealth Management Limited, JLT Investment Management Limited and Independent Trustee Services Limited. JLT Employee Benefits is part of Jardine Lloyd Thompson Group plc.