At first I thought it must be a typo, a clunky misprint that had somehow managed to ooze its way past the desk of ITV’s spelling-and-grammar tsar. And now here it was, winking at me from the foot of the TV screen: so ludicrously over-inflated, so mind-bogglingly gargantuan that not even the dimmest amoeba-brain could fail to recognise it as a stinker. It read: “Typical APR 1,270 per cent.”
It wasn’t long before I’d spotted it again. Same pay day loans firm, same impossibly-huge four-digit number: “Typical APR: 1,270 per cent.” Suddenly it struck me. These guys were serious. This was a genuine, real-life APR.
Not since the days of renaissance Florence have money lenders so openly and unashamedly touted such outlandish APRs. In fact, to spend time surfing daytime TV channels is to believe oneself back in the days of the Borgia and the Medici. Then again, surely even he would have baulked at 1,270 per cent.
But at least Florentine bankers knew customers and, in their own way, had a vested interest in their ability to repay. That’s not always the case today. Little wonder that so many people suffer from the curse of omni-present financial anxieties – anxieties which like the poison from a skilled Florentine assassin can all too often seep into the workplace.
Concern about financial wellbeing is one of the reasons why I have been keen to be involved in Neyber’s new research project looking at the DNA of financial wellbeing. The research illustrates the extent to which financial wellbeing is unequally distributed across the different generations and how in particular the post-crash Generation Y or Millennial generation, has become vulnerable to increased debts and reduced assets.
Challenges for employers
For employers, the research highlights how employees’ financial worries have a direct impact on workplace performance. The idea that people in the workplace who are concerned about their ability to meet debt repayments are able to perform at optimum levels doesn’t make sense. If you’re worrying about money when you’re at home, chances are you’ll be still worrying when you’re in the workplace.
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For Millennials, it’s long been known that the sheer complexity of personal finances can often mean that many opt for short-term benefits over long-term sacrifices. Others, when it comes to making financial decisions, simply opt out altogether. This attitude has to be challenged. Thanks to the internet and social media, never before has financial information been more readily available to so many people. And never before have so many switched off.
Growing up in a world in which debt has lost much of its stigma, this research shows the risks that Millennials carry when, later in life, they are refused credit. The statistics generated by the report make for sobering reading – particularly in terms of the numbers of people who have been refused access to credit and the percentage of those who are in work but who have to borrow simply to meet their credit card repayments.
Unless we help this generation learn how to make the most of its finances and to acquire the skills and knowledge needed to navigate the financial landscape, there is a genuine danger that today’s Millennial generation will become, in financial terms, the lost generation.
For employers, helping staff with their financial wellbeing isn’t just a social responsibility; it’s likely to offer bottom-line benefits in terms of reduced turnover, greater levels of engagement, lower levels of absenteeism and more motivated, better performing staff. Many organisations have long since seen the benefits in investing in staff’s physical wellbeing – lots of firms now have company pamper days, nail bars and wellbeing seminars. But what about financial wellbeing? This research demonstrates just how popular such opportunities would be if implemented into the workplace.
The report emphasises the need to get people at work talking about their personal finances. It’s time for a workplace conversation about money – not just how to make and spend it; but how to manage it. Too many people at work are suffering high levels of stress and anxiety because of an inability to manage their personal finances. Few – particularly men – feel that they have no one to turn to for advice and guidance. It’s time for responsible employers to fill this void: not only will it make a genuine difference to the lives of employees; it will also impact directly on the bottom line. Good financial sense is good business sense.
Paul Redmond is director of student life at The University of Manchester.
Growing businesses invest considerable time and energy pursuing new contracts – the bigger the better. However, securing a big win can increase pressure on the business and it is important to plan ahead to ensure the right resources are in place to support its rapid growth.
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