The goal of the newly created Single Financial Guidance Body (SFGB) will be “a society where everyone makes the most of their money and pensions”, according to chief executive Sir Hector Sants.
In his first public speech since starting his new role, he emphasised the importance of financial wellbeing generally and the critical role that employers must play in achieving this.
Speaking to a business audience at a Neyber supper club he said: “We want to establish the importance of financial wellbeing as a top priority… to a level comparable to that of mental and physical health.
"We need a credible financial capability strategy to equip adults with the necessary skills for life to manage their money and pensions."
He said that the newly launched SFGB would be taking a different approach to its predecessors and would look at prevention rather than just remediation and was keen to stress the important role that businesses need to play to make financial wellness a reality.
Hs explained: “Traditionally, money issues are engaged with only when events require it, for example, when individuals sadly lose their jobs, suffer ill health or more positively get married or have children.
“The willingness of individuals to consider their wellbeing needs to move from being transactional and triggered by events to being an everyday consideration.
“The biggest opportunities are undoubtably through working with employers. It is critical you see that one of the central tasks of your organisation should be helping us deliver on that vision and something you have to do to discharge your obligation to society as a whole.”
He highlighted promoting payroll deduction schemes in general as a way of encouraging saving and explaining the value of solutions like the NEST sidecar as just two ways that employers can help staff better manage their money.
He concluded: “Our vision would have employers working with us to encourage their employees to meaningfully engage with money matters, and hopefully through that engagement encourage them to save, budget and borrow in a responsible manner – which in turn gives each individual financial resilience.”
It was a step away from previous government advice, which suggests that individuals need to take sole responsibility for their financial affairs.
Instead, Sants recognised that businesses have a duty of care to help their employees manage their finances and are well placed to achieve this.
This is hardly surprising. Research suggests that consumers are more likely to think about their finances when triggered by events in their lives, ranging from changing jobs, payday and signing a new rent agreement to marriage, divorce and children.
It is therefore natural to think that companies have the right information, access and advice to make a difference in their employees’ financial wellbeing.
The Single Financial Guidance Body is looking at everything from education to access, and Sants was clear that he can see businesses playing a role at each step along the way, whether that’s improving education or promoting inclusion by giving access to financial education.
Sants concluded: “We want organisations to recognise that ideally they should see themselves as a central element to the solution of financial wellbeing – the same way they are when it comes to health and mental health.”