Making pay go further through salary sacrifice and retail discounts.

If you have noticed the increase in your energy bill, food bill, and fuel bill of late, you are not alone! It seems that barely a day goes by without hearing of some new cause for increased living costs on our news feeds. It affects everyone and can cause significant anxiety and stress.But, when the outgoings seem to just be going up and up, we do not just have to sit there and wallow. There are ways that we can help our cash flow.Far from being a frivolous luxury, work perks can give very real monetary benefits to your team’s finances. They can allow employees to bring home more pay after tax and spread the cost of everyday essential items.Most of all, they can help invest in your team’s financial management skills, significantly improving their financial wellbeing and bringing financial security.Here are just a few ways that employee benefits can help your team's cash flow.

1) Reduce National Insurance Contributions

The main reason that some employee benefit schemes can help cash flow is that some benefits are paid before tax as a form of salary sacrifice. A lower take-home salary means that employees' National Insurance Contributions (NICs) are calculated on a smaller amount, therefore reducing the overall cost of the Contribution. This in turn means that employees’ post-NIC income is more.It is important to note that employees need to be made aware that some salary sacrifice benefits can affect their entitlement to certain earnings-based benefits such as Additional State Pension and Maternity Allowance.It can also affect their entitlement to some contribution-based benefits, such as State Pension and Incapacity Benefit. It can also affect how much Statuary Pay an employee can receive.

2) Reduce outgoings

Another way that work perks can help cash flow is by reducing outgoings on everyday essential costs. An example of this is retail discount schemes.Retail discount schemes allow your employees to get discounts on purchases made in a selection of shops, restaurants, and cinemas. Employees can make savings on day-to-day essentials as well as on larger purchases such as holidays and days out. These schemes can have a real positive tangible impact on employees’ cash flow, meaning their money can go further.

3) Develop Financial Wellbeing

All of these improvements to your cash flow are fantastic, and can really help. But having a good cash flow and a generous disposable income is not always about simply increasing one’s take-home pay or looking for ways to distribute money in a more high-value way. Keeping a good cash flow requires good financial management, and this is a skill that needs to be developed.A significant way of helping employees’ cash go further is an ongoing investment in their financial wellbeing and education. Providing them with the skill-set and resources they need to manage their money not only brings more financial security but also empowers them.Tools such as Financial Wellbeing Education platforms can provide employees with access to webinars, blogs, videos, podcasts, and more to help them develop their skills in money management.

Invest in the person

Absolutely, increasing your employees’ cash by providing benefits that spread costs or reduce taxable income can all improve an employee’s finances. But developing their money management skills is an investment in them as a person, and can significantly improve their financial security and wellbeing long-term.