Employers today are spoilt for choice when it comes to the range of savings products available for them to put in place for their workforce. But they are increasingly recognising that every individual has different needs and that a generous pension contribution doesn’t necessarily appeal to everyone. Ahead of the Reward Financial Engagement Forum on 15 November, Kavitha Sivasubramaniam spoke to Charles Cotton, senior performance and reward adviser at CIPD, about savings beyond the world of pensions

Charles cotton

  • What’s your involvement/experience in this area?

The CIPD has been involved in the area of helping HR improve how they talk about pensions and reward for the past 10 years or so, through research, guides and events. Most recently, with our sponsor Close Brothers, we commissioned IES to carry out a study of employee financial wellbeing, looking at what it is, why it matters and what we can do to improve. As well as the findings from the research, you can find support on how to implement an employee financial wellbeing programmes at www.cipd.co.uk/financialwellbeing.


  • What other savings schemes are on the market – for example, to help employees to get on the housing ladder, or out of debt?

A lot of attention, quite rightly, has been given to workplace saving, most notably pensions, to help individuals save and to protect them from unscrupulous behaviour. We now need to have a similar review of debt and how employees can access low-cost loans through the workplace, which incorporates legal safeguards.


  • How are employees’ financial requirements impacting their savings?

Our research shows that employees, especially younger workers, are concerned about their inability to save for their future, such as for a home or their retirement. However, while millennials recognise the importance, they face competing financial pressures for their money. In addition, many are put off by the idea of a pension, looking for a savings and investment product which can be a bit more flexible.


  • When does retirement become a priority?

Saving for retirement is always a priority, it just depends on personal circumstances and when people are able to commit enough money for the post-work period.


  • How can employers ensure that their employees are still saving enough into their pension that they will be able to retire?

Employers should help employees think about when they would like to retire and on how much. For instance, do individuals want to stop work all together when they retire, or would they like to carry out paid or volunteer work? HR should point staff to online modellers and tools to help them consider various scenarios concerning what they can expect when they leave work in terms of state and workplace pensions. They can encourage pension savings by matching employee contributions and ensuring that the workplace is value for money in terms of fund performance and fees.


  • Why should attendees come along to the conference, where you will be taking part in a panel discussion?

Our research, which we released earlier this year, found that one in four workers reported that money worries had impacted on their ability to do their job. This had manifested itself in them having less energy, being distracted and having to take time off from work. While research indicates that employee financial wellbeing is unlikely to improve in the short term, this session will help identify some of the other schemes on the market, the importance of prioritising retirement and ways that employers can help their staff set themselves up for the future.