In the past two years, we've seen a lot. The lingering economic fallout of the pandemic, critical labor shortages, and low employment have forced people to reevaluate their financial planning and security relationship. This article will explore the concept of financial security, why it matters now more than ever, and the steps you must take to make a meaningful difference for yourself in this area.
You'll most likely get different responses if you ask people what "financial security" means. For some, it is being able to support their family and getting a good education for their children while putting aside enough to fund a comfortable retirement for some people. At the same time, it's about getting through the month with enough to cover their rent and utility bills and not worrying about their car or refrigerator breaking down without being able to fix them for others.
There's no right or wrong answer. Financial security is subjective. It will always mean different things to different people. If we have to sum it up briefly, we'd best define it as:
"Not having to worry about money all the time."
Many people from working and middle-class backgrounds feel that financial security is out of their reach, which isn't surprising, considering the state of unemployment or payscale in countries like India.
Financial security doesn't have to be a dream for anyone anymore.
Money worries place a massive burden on a person's mental health. Money-related stress can lead to unwelcome side effects, which may include:
Financially secure people are happier long-term. Financial security is like a cup of hot chocolate on a winter night. It does deliver more happiness over time than most - anything that money can buy!
Financial insecurity is a widespread challenge, and becoming financially sound and secure isn't a piece of cake for anyone.
In the current economic state and given the overall corporate conditions, many socially mindful employers are thinking thoroughly about ways to help employees (both current and future) get on the front foot financially.
No solution works for everyone, as everyone will have different circumstances and challenges.
However, some organizations are beginning to build out a balanced approach that comprises complementary wellness tools that are easy for individuals to access, understand, and use.
Lately, one of the most in-demand benefit programs employers have been offering all around the globe is payment flexibility. Especially, Earned Wage Access (EWA) services are an increasingly common element of benefits packages these days.
Earned Wage Access is an innovative workforce–a centric initiative in which employees can access their earned pay before payday, pay they've accrued but not yet received. It highlights financial wellness in the workplace, improving staff morale and work productivity.
EWA services can help ease unexpected cash needs. Payday loans and short-term installment loans prey on the vulnerability of people who need instant access to cash. Lenders charge high-interest rates on small amounts that fold over as time passes leading to debt. Every time one borrows money, they effectively open themselves up to the risk of being sued, losing their home or car, or having to file for bankruptcy. Debt is a trap. Plain and simple. It can be tempting, but it can also be fatal. One way to avoid these high-interest loans is to access your earned wages on-demand through Earned Wage Access (EWA) providers like Rain.
Instead of borrowing money from payday lenders, employees could access the money they've already made for a nominal fee between paychecks and avoid debt traps, no questions asked.
Many employees appreciate the financial well-being aspect of these flexible pay models, as they offer a means to avoid unnecessary debt. They find that this allows them to have more control over their finances than before, which takes a big load off their shoulders.
Whether you're defining financial security for your staff or are on your way toward building it for yourself, we're here to help you.
Happy Financial Planning to you!
You can learn more about Rain here.