Our relationship with our finances is central to our overall physical and emotional wellbeing. But in the current climate, business owners, individuals and families might be facing pressures as a result of the pandemic or other unforeseen events. So, it is more important than ever to build good financial wellbeing – whether it is improving your own or supporting your workforce to manage their money and pensions. Fortunately, there is support available to help people find a way forward.
What is financial wellbeing and why is it more important than ever?
Financial wellbeing means feeling secure and in control of your money. It’s about making the most of your money day today, dealing with the unexpected and being on track for a healthy financial future. In short, feeling confident and empowered. Financial wellbeing is good for individuals, communities, business and the economy. Pre-pandemic, levels of financial wellbeing across the UK were low. 13.4 million people were financially struggling, while a further 16.7 million people were financially squeezed, meaning their budgets were already over-stretched or very tight. Our research showed that 11.5 million people had less than £100 in savings to fall back on; 9 million people often borrowed to buy food or pay for bills; 22 million people didn’t know enough to plan for their retirement; and 5.3 million children did not get a meaningful financial education. For many, not least those who are business owners, often with uncertain income, these challenges have been magnified by the continued impact of the pandemic and pressures related to the cost of living.
Tools and resources to support business owners with their money and pensions
Current money challenges faced by many households can be particularly hard when you’re self-employed, managing both business and personal finances or have a workforce. MoneyHelper, run by the Money and Pensions Service (MaPS), provides direct support for people who are self-employed and looking to find their way forward when it comes to money. It offers free digital, telephone, print and face-to-face support on money and pensions guidance. Specialist help is available for:
- Planning and paying for tax and National Insurance
- Managing a variable income
- Getting any debts under control
- Savings, pensions and protecting your business
- How to cut back on costs and maximise your income if your budget is being squeezed
- Where to get free regulated debt advice for your small business if you have fallen behind on payments.
If your income has been squeezed, you may also be worried about falling behind on some bills. The consequences of not paying off some bills can be more serious than others, for example if you do not pay your Council Tax, the Council might send a bailiff to visit your home to collect payment or you could face court action. Therefore, it’s really important to pay off priority debts first. MoneyHelper’s new Bill Prioritiser tool can help you sort out bills in the right order and tell you what you need to do if you’re struggling to pay. This could include how to talk to your providers and agreeing a payment plan, or what extra support you might be entitled to.
By Monica Kaur, regional partnership manager at Money and Pensions Service.
This article originally featured in the May/June issue of London Business Matters Magazine.