The Grand Illusion of High Earnings: A Plot Twist in Financial Wellbeing Saga

In the shifting economic landscape of the UK, we find an essential truth often overlooked: financial wellbeing is not reserved for those earning average or below-average salaries. High earners, too, are vulnerable to financial struggles, reminding us that earning power doesn't necessarily translate into financial wisdom. Today, the role of technology in supporting employees' financial wellbeing is no longer a nice-to-have but a must.

The Debt Crisis – Not Just a Low-Income Problem

Recent research by Hargreaves Lansdown and Oxford Economics has unveiled startling statistics that dismantle the myth of financial immunity among high-income households. It seems that money can buy many things, but clearly, not budgeting skills:

• Households with a combined annual income of ￡60,000 or more are disproportionately at risk of sinking under debt.
• Many in this income bracket have taken on mortgages of ￡300,000 or more, exacerbating their financial vulnerability.
• With the recent rise of interest rates to 5% and mortgage rates topping 6%, these households face significantly increased financial burdens.
• The monthly repayment for a ￡300,000 mortgage, for instance, has seen a jump from ￡1,272 to ￡1,933 – an increase of ￡661 a month.
• About one in four households, irrespective of income level, are drowning in debt, spending more than they earn.
• Among higher earners, an estimated one million borrowers live unsustainable lifestyles, consistently spending beyond their means.
• These individuals typically spend roughly one-third of their income on mortgage repayments, higher than the average household's 25%.
• Over the next year, a worrying 26% of mortgage holders risk falling into arrears, more than double the pre-pandemic level.

These figures are a stark reminder that the debt crisis transcends income levels, affecting both low and high earners.

Harnessing Tech for Everyday Money Matters

Given these worrying trends, it's clear as day that all our employees, no matter what they earn, need solid financial support. That's where technology comes in, offering us a helping hand. It equips us with all the necessary tools to guide, assist, and educate our employees on their road to financial wellbeing.

What's brilliant about technology is that it lets us tailor our approach to financial wellbeing, meeting the distinct needs of both lower and higher earners. With a tap or a click on apps and online platforms, employees can dive into a world of financial knowledge, budgeting aids, and saving methods. This makes it easier for them to keep a handle on their finances and avoid spending more than they should.

Plus, thanks to the clever work of fintech, we have access to real-time snapshots of spending habits. This helps our employees spot any trouble areas and make the necessary changes. With AI and machine learning on our side, these platforms can even predict trends and offer custom advice, giving our employees the support, they need to make sound money decisions.

What are these incredible platforms, you might ask? Well, I’ve been looking around, and unfortunately, when talking about employee benefits space, such platforms are mostly just in my head. However, I found one great contender – Money Guided , which so far looks very promising.?

A Call to Action: Let's Embrace Technology!

As employers, it's on us to boost financial wellbeing among our workforce, no matter how big their pay packet is. By making the most of technology, we can deliver financial wellbeing initiatives that are not just inclusive and easily accessible but also personalised to each employee's financial situation.

We need to acknowledge that a big salary doesn't automatically mean you're financially healthy and embrace technology as a way to offer solid financial support to our employees. There's no one-size-fits-all solution when it comes to financial wellbeing. But with the right tech in our corner, we can guide our employees along their individual paths to financial stability.