5 financial tips that you can give your collaborators to manage the crisis

The worry, anxiety, and stress caused by financial problems can affect the well-being of your employees and hurt their productivity. One way to avoid these situations and support the finances of your team members is to advise them with financial advice, a valid option to provide them with well-being, security, and possibilities for economic growth.

Providing your team with useful tools for their finances allows them to learn how to manage their income and assets, especially during periods of crisis. Likewise, it keeps them motivated and valued, with a sense of belonging (which minimizes staff turnover or talent loss).

So that your organization has people who understand the world of finances, are aware of the role of their personal and family finances for their well-being, know the basic principles of income, expenses, investment opportunities, and financial risks, as well as the importance of foresight and making informed decisions, we recommend promoting financial education among your collaborators.

Here we give some basic tips that can help you manage your economy in times of crisis and economic uncertainty.

Financial education is key for your staff to make the best use of their income, which can be even more beneficial than just salary increases without proper management. Thus, as a leader you have in your hands the possibility of helping your collaborators by giving them some tools to improve their economic situation and, therefore, their well-being. Between them:

Prepare a budget

People must recognize what their fixed income and expenses are (monthly, annual). This will allow them to have an idea of ​​what their priorities and debts are. The estimate must include fixed and sporadic income and classify it by level of certainty in obtaining it.

This budget will give employees basic information about their income-expense relationship, the first step in becoming aware of the state of their finances. By having an established budget, you will already know what your financial situation is and will be able to make decisions about it to maximize the distribution of resources.

Find unnecessary expenses

Spending more than you earn is the basic origin of financial problems. Sometimes it is not just about "earning more", because if the new income is squandered, it does not resolve the imbalance in finances either. That is why it is so important to learn to minimize unnecessary expenses, an action that can provide a more or less significant flow of liquidity.

Motivate your collaborators to review their ant expenses, those small outlays for trifles or underused services that, added together, can represent a considerable sum month after month. For example, how many of the paid apps or online subscriptions do you use? Going without some can make a difference in your pockets.

Additionally, you can help them become aware that some habits not only their money but also their health. A very clear example: is smoking.

Encourage investment

They say that "opportunities arise from crises", so you can encourage your employees to develop their skills, diversify their money and generate extra income. The idea is that they learn to invest their money intelligently, either through financial instruments or by developing a personal project that yields profits.

Not only can this improve their financial situation, but they will also feel supported and supported by the organization

Encourage savings

Although it can be difficult to save during crises, insist on the importance of allocating a portion of your income to an emergency fund. Having financial support provides peace of mind and is key so that, in the event of an eventuality, people do not have to incur debt on their fixed obligations or resort to financing.

A recommended percentage for that fund is 10% of income (taking into account not only the fixed salary but also payments for overtime, bonuses, and commissions). If this money is deposited in a savings account it will be well protected and can generate some type of interest.

Avoid debt

Although we have left it for the end of the article, this is one of the most important financial advice that you can give to your collaborators: do not opt ​​for financing, especially if it is intended to cover expenses or buy non-essential items.

Getting into debt is a very common situation when you do not have control of your finances. That is why it is essential to be aware of the possible consequences of acquiring debt... unless the money is used for some productive investment (that will generate more income). When credits are requested, they include interest, which implies paying more than what has been received. So it is best to control your impulses while the economic situation improves.

As you can see, various financial recommendations can help your employees overcome the crisis that the economy is going through, improve their economic situations, and stay productive to contribute to the growth of your company. Additionally, by providing this help you will be able to develop a closer bond with them, who will know that you care about their well-being.

Healthy finances for your collaborators

Given the importance of the good financial health of your collaborators for their personal well-being and better productivity in the organization, remember the basic principles of financial education that can help them:

• Learn to account for income and expenses.
• Identify which expenses are essential and which are dispensable or unnecessary.
• Promote savings, investment, or the development of personal projects.
• Encourage the creation of a backup fund to cover unforeseen events.
• Reduce any possibility of debt.

But there is much more. We recommend that you continue researching and find other useful financial tips to increase your well-being, because the happier and more in harmony the members of your work team are, the better the results they will give to the organization.