June 12, 2020 Personal Budgeting

A course on personal budgeting – an HR initiative that your employees can benefit from.

Let’s be honest: we can never find happiness or even sanity in this world without money. We use it to feed ourselves, send ourselves or our children to school, and even enjoy little treats every now and then. Those who say that money is the root of all evil do not have the full picture because; hey, money is the root of everything!

Given its importance, we as employers should understand that our workers somehow yearn to earn more as they work for us longer. The more they earn, the more satisfied they are. The more satisfied they are, the higher the possibility that they will stay.

However, sometimes a pay raise is not enough. Even the highest paid among our employees will easily go broke if they don’t budget their cash well. Employers nowadays can (and should) teach personal finance as part of the benefits or perks that they offer their employees.

In this article, we provide a quick budgeting lesson that you or your HR department can share with your employees. Specifically, we take note of the three items that should be in each person’s budgeting pie.

Necessities

Of course! This is a no brainer; we have regular bills to pay, and it is totally normal for us to allocate a specific amount each month for them. Why is this even mentioned here?

You see, even with necessities, there are obvious and non-obvious expenses. The obvious ones are of course rent/mortgage, groceries, and money for gas. It would be bizarre for anyone to forget about these.

For most employees, however, problems in budgeting arise with the non-obvious. For example, there’s tax. This is a required expense, regardless of their feelings for the government. Good thing that we have HR that processes taxes for everyone. HR can be assisted by a w2 creator online for this function.

Another potentially non-obvious expense that employees should prepare for are insurances. As their income grows, so does their buying capacity. They may even think of getting a car. While this is good, they should know that most states require drivers to have car insurance. So this should be considered while making decisions.

Savings

When we talk about savings, that’s where a lot of employees fall short. What they do is spend on whatever they want and need, and what’s left of their money after that goes to savings. For a lot of people, nothing is left, so nothing is saved.

But saving money is a must for any modern person — our bad savings habits have to change. Instead of relying on what’s left, let them see the value in living slightly below their means. The moment they get their paycheck, they can take a certain percentage from it and set it aside as savings right away! By doing this, they can be sure that their bank accounts grow.

Leisure

Many conservative thinkers don’t seem to be fond of spending money for fun. For them, doing so is seen as a waste.

Employees should understand that they shouldn’t follow that lead. They are modern human beings, and they know very well that they can’t live without taking a break and having some fun once in a while. You see, they are even delighted if we take them out on company-sponsored trips!

They can protect their money from unforeseen expenses by including leisure in their budgeting from the very beginning. It’s not bad to enjoy money a little. Everyone needs a little fun!

To avoid unforeseen cash-outs, the budget should include items that employees can’t help but spend money on. They should spend time and brainpower on personal finance planning; this will save them a lot of trouble later. Teaching employees how to budget is a good step for us as employers who care.

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