CIPD urges employers to help workers with debts
CIPD urges employers to help workers with debts
Workers in debt should be offered a helping hand by their employer, it has been said.
Workers with financial problems due to debts they have accrued on personal finance options such as credit cards and personal loans could be offered help from their employer, it has been suggested.
According to Charles Cotton, performance and reward adviser at the Chartered Institute of Personnel and Development (CIPD), companies can come to the aid of any members of staff who are struggling with their money - due to issues such as loan repayments - by formulating and running internal programmes to educate employees.
Mr Cotton stated that the rising cost of living in the UK is being contributed to by factors such as increasing food and fuel prices, meaning that financial issues are likely to affect more people in the near future.
"What the organisation can do is perhaps put in an employee assistance programme - these are helplines for third-party organisations that employees can phone about a number of issues and concerns, including financial ones," he explained.
The CIPD official went on to say that "financial education and advice" from senior managers is important as this could help individuals in their efforts to "reduce their debt or manage their debt more effectively".
These comments came after the publication of a report yesterday (March 28th 2011) by the Consumer Credit Counselling Service (CCCS), which revealed that nearly half of all the people the body counselled throughout last year cited a reduction in their income or unemployment as the primary cause of their debt.
As a result, the CCCS warned that this issue may be compounded by the fact that the country's level of inflation is continuing to go up as well as the rate of unemployment, meaning that a growing number of consumers could find themselves encountering financial difficulties in the near future.
Meanwhile, Universities should help their students to avoid excessive debts, it has been said.
Students at university struggling to fund their lifestyle with their current account balance should be provided with greater levels of resources in order to help them better manage their finances.
Many scholars often find the transition into being in complete control of their finances tough and could therefore resort to options such as personal loans or credit cards to make ends meet.
Therefore, it could be important for educational institutions to offer their students more support in terms of money to make sure they are fully aware of the responsibilities they face when leaving home for the first time to help them avoid debt issues.
That is the opinion of Andrew Hagger, spokesman for Moneynet, who said there "needs to be a little bit more education from the universities themselves".
Mr Hagger went on to say that this need not be a huge commitment from the universities, just "half and hour or so when people first join" to "explain to them a little bit about managing their money and making it last".
He added that giving attendees "an idea" of the costs they are going to incur throughout their time studying would provide them with a firm financial footing moving forward, possibly meaning that they resist the temptation of taking out credit.
This follows on from a study conducted by the Student Loans Company published last week (March 16th 2011), which noted that female students are often more frugal then their male counterparts when purchasing items of clothing and also save some 380 annually in comparison to men when buying food and paying mobile phone bills.
The Moneynet official went on to say that the global economic downturn has also undoubtedly had an impact on student finances.
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