Debt Solutions for Employers

Why Should You Care About Your Employees’ Debt and Financial Health?

Long ago, there used to be a clear-cut separation between people’s work lives and personal lives. It was easy for employers to take the view that what happens at home, stays at home.

That is no longer true, especially in South Africa, where we have a big over-indebtedness problem. Given a large segment of South African consumers are financially-stressed, it is very likely that many of your employees, too, are suffering from financial distress.

The question is: when do your employees’ personal problems become your problem as an employer. The answer is: when it starts drastically affecting their productivity at work, the morale of your team, and your ability to deliver as a business.

How Do You Know Your Employees are Struggling?

Your employees are struggling when you see clear drops in their performance, but by that time, it is often too late to mitigate the impact. Instead, try listening to what your employees are talking about around tea and lunch breaks. The following types of stories could be a sign that financial stressors are seriously affecting your employees, and could in turn affect your business:

• Changes in family income;
• The unexpected need to support a parent, child, family members, or another person;
• Falling victim to unscrupulous or fraudulent schemes;
• The unexpected birth of a child;
• The unexpected death of a spouse;
• Illness and disability;
• Accidents;
• Major unexpected bills;
• Divorce and lawsuits;
• Being bothered by debt and debt recovery agents; and
• Creditor calls and harassment by collection agents.

There is a common misconception that a good salary equals financial health, and that only low-income employees struggle financially. Income alone does not paint the full picture. Your employees may have massive debt and other financial issues, often hidden far from view due to shame and the stigma around debt.

Benefits of Debt Counselling for Employees and Employers

By partnering with Debt Sage to offer your employees financial education and debt management solutions, you are unlocking a wealth of benefits for both you and your employees.

Benefits for Employees:

1. Financial Literacy: Our debt counselling process provides your employees with valuable knowledge and skills to manage their finances effectively, including budgeting, debt repayment strategies, and savings techniques. They have access to an expert counsellor who assists them every step of the way.
2. Debt Reduction: Counsellors work with employees to develop personalised debt repayment plans, negotiate with creditors, and explore debt consolidation options. This helps them regain control over their finances and reduce their debt burdens.
3. Stress Reduction: By addressing your employees’ financial challenges and developing actionable plans to tackle their debt, their stress about their finances will significantly be reduced, improving their well-being, job performance, and job satisfaction.
4. Removing the Stigma: By encouraging your employees to acknowledge their debt problems and consider debt management solutions, you are breaking the stigma associated with debt and making your employees feel safe to tackle their problems.
5. Improved Financial Habits: Debt counselling encourages employees to develop healthy financial habits and behaviours, such as responsible spending. In doing so, our solution changes the fundamental issues which put your employees at risk in the first place. This can have long-term positive effects on their financial stability.
6. Increased Financial Confidence: Through counselling sessions and support, employees gain the confidence to manage their finances responsibly, make informed financial decisions, and plan for their future financial goals.

Benefits for Employers:

1. Enhanced Productivity: Employees experiencing financial stress often struggle to focus on work, decreasing their productivity and performance. Debt counselling helps alleviate your employees’ financial worries, allowing them to concentrate on their jobs.
2. Reduced Absenteeism: Financially-stressed employees may take more frequent absences due to their stress manifesting in health-related issues, depression, and more. By providing debt counselling and removing the stigma around debt, you can help your employees take control of their finances, reducing their stress, and in turn reducing absenteeism rates.
3. Employee Retention: Offering debt counselling as part of your employee benefits, and positively changing your employees’ lives through it, shows that you care. It demonstrates a commitment to supporting employees' financial well-being. This can increase employee loyalty, satisfaction, and retention rates, as employees feel valued and supported by you as their employer.
4. Cost Savings: Addressing employees' financial challenges through debt counselling can lead to cost savings for employers through reduced absenteeism, reduced turnover, and reduced healthcare expenses associated with stress-related illnesses.
5. Positive Workplace Culture: Promoting financial wellness initiatives, such as debt counselling, fosters a positive and constructive workplace culture that prioritises employee well-being.

Overall, debt counselling can be a valuable resource for both employees and employers, creating a “win-win” situation.

How to Create a Plan to Improve Your Employees’ Financial Health

Improving employee financial well-being involves more than just teaching financial literacy. It requires combining financial education with practical products and services that promote behavioural change and lead to better financial outcomes. The goal is to equip employees with both knowledge and access to financial tools that facilitate debt reduction, responsible spending, saving, and long-term planning.

Once a company recognizes the importance of employees’ financial health, it's crucial to assess the specific needs of its workforce. The best way to do this is to have open and honest conversations with employees about their financial challenges. There is no universal solution for addressing financial health issues, as individual circumstances vary.

There are numerous workplace programs, products, apps, and services available for you to adopt to assist your employees. These can help with managing debt, saving for emergencies, and planning for the future.

Here are seven steps to craft an effective financial health strategy for your employees:

1. Recognise the opportunity to enhance employees’ financial well-being;
2. Align your company's support with improving employees’ financial health;
3. Engage in open and honest conversations with your employees to understand their financial needs;
4. Identify and implement suitable solutions to address these needs;
5. Encourage employee engagement with financial health initiatives;
6. Measure the success of your strategy in improving employee financial well-being;
7. Commit to continuous improvement by refining and adapting your approach over time.

How Debt Sage can Help You

Debt Sage’s team of experts have helped thousands of South Africans and would be happy to help your company. We help organisations implement debt solutions that alleviate financial stress among employees and improve overall workplace productivity and well-being.

Here are some examples of the tailored debt solutions for employees that we offer:

1. Financial Literacy and Counselling: We offer workshops, seminars, or one-on-one counselling sessions to educate employees about managing debt, budgeting, and improving their financial habits.
2. Employee Assistance Programs (EAPs): We can integrate debt counselling services with your EAP benefits to support employees facing financial difficulties.
3. Debt Management Tools: We can provide your employees with access to online tools and apps that assist them with tracking their debt, setting financial goals, and managing their finances more effectively.

Speak to us today to see how we can help!