In a world where prices continue to climb, it’s crucial for businesses to be vigilant about any unnecessary financial costs. Yet, many businesses might be inadvertently losing money because they lack a competitive pension package. Think this isn’t a big deal? Dive into the details below and see the potential of saving a significant amount.
Retain top talent and save substantially
Very few employees stay with the same organisation for their entire careers. Life changes, and individuals may seek better pay to finance a new home, improved working conditions, or even a shift in their career direction.
While it’s impossible to control all reasons for employee turnover, businesses can mitigate some of its costs. As per a study by Oxford Economics and Unum, the average cost to a company for each employee departure is roughly £30,000.
Consider this: A 2022 survey conducted by tech giant Lattice, which included 200 HR professionals and 2,000 UK-based workers, revealed that 14% switched jobs due to superior benefits. Therefore a business with a team of 100 could pocket savings of up to £65,000 annually with a strategic pension plan.
By presenting a more enticing pension proposal, firms can foster greater employee loyalty. It demonstrates concern for their prolonged financial health. If employees are persuaded to remain, the savings can be substantial.
Choose a pension that simplifies financial management
Increasing everyone’s salary isn’t the singular answer to addressing the cost of living surge. It’s a given that businesses must offer pension plans to their workforce. Why not opt for one that also includes financial wellness workshops, educational sessions, and tools for a clear view of post-retirement earnings?
Many find the world of pensions daunting due to its complex terminology and outdated offerings. Modern pension providers are striving to revolutionise this landscape. Penfold’s intuitive pension app facilitates retirement income projections, pension consolidation, and easy contribution top-ups during surplus periods.
Moreover, Penfold is passionate about conducting workshops and programs to guide employees in financial literacy and effective saving strategies for their future.
Value time and productivity
Understanding the worth of every minute is essential. In a professional setting, there’s always a mountain of tasks and finite hours. Employees experience this too.
While they balance their professional duties, they’re also handling personal matters – from emergencies with children to coordinating with elderly parents or fielding calls from a partner stuck in traffic.
Nobody wants to be trapped in a long hold-time when a pension-related issue arises, only to be shuttled between different departments. With Penfold, that’s a non-issue. Workplace pension clients have access to a personal account manager, ready to assist when needed.
Using Penfold’s app, employees have all the necessary tools to manage their pensions effectively. And on the rare occasions they need assistance, their dedicated team — real people, not automated systems — is ready to help. This ensures optimal productivity without interruptions from subpar service.
Capitalise on salary sacrifice: a win-win tax strategy
Given the current economic strain, a government-sanctioned tax benefit can be invaluable for both employers and employees. Through salary sacrifice, employees can elect to reduce their annual wages, diverting the difference into their pension fund.
Lower earnings result in decreased National Insurance (NI) obligations, one of the primary deductions from pay checks. And if they’re taxed less, their net salary increases.
Similarly, companies also have to pay NI, calculated based on the total payroll. A reduction in the overall payroll means a lower NI obligation. For a company with 100 staff members, with an average wage of £50,000, this could translate into an annual savings of £34,500. See how Penfold’s salary sacrifice pension can help maximise your savings.