SYDNEY, November 11, 2022 /PRNewswire/ — Fintech for financial well-being Wagestream urge employees to Australia to take a few simple steps to move from financial stress to financial well-being – and says that even with rising prices and hard-to-get pay raises, there are simple steps that can be taken.
Encouragement comes after a joint report between ASIC and Beyond Blue published last month has demonstrated substantial evidence that financial wellbeing and mental health are linked, and that Australians are suffering from increasing cost of living pressures.
The ASIC & Beyond Blue report revealed that financial stress can contribute to conflict, social isolation, guilt and shame, stress, low mood, low self-esteem, substance abuse, panic attacks, self-harm and even suicidal ideation and actual suicide.
On the other hand, financial well-being occurs when a person can meet their expenses with some money left over, are in control of their finances, and feel financially secure now and in the future.
According Josh VernonCEO of Wagestream Australia, there are a number of tactics Australians can implement immediately to start moving from financial stress to financial well-being.
Use your own money (if possible) to pay for unexpected cash shortfalls
Josh Vernon continues: “It’s essential to have an emergency fund that you can access if you suddenly find that your car needs fixing or a huge energy bill hits you. That’s where the automation of regular savings is so useful.
“But if you find yourself in a sudden cash crunch, the last thing you want to use is an outstanding credit facility like a credit card or payday loan with significant fees. Instead, you can use your own money to pay for an unexpected expense via an “access to earned wages” offer.
“Products such as ‘earned pay access’ allow employees to access a portion of their earned pay before the end of their pay cycle. Because they are offered by employers, the fee is often subsidized , making it an affordable and responsible option.
“Knowing that you can access this service anytime from an app on your phone can also create great financial peace of mind, even if you never use it.
“Wagestream charges an apartment $2.49 fees for its earned wage access product, regardless of the amount an individual accesses flexibly. So it’s $2.49 to access $200 Where $2,000 – nothing complicated here.
“In many cases, the employer covers this cost for their employees as a social benefit. When the employer does not cover the cost, the employee pays the fixed costs. There are no other costs for employees to use the app – no fees for using our Grow, Learn, Track or Coach features and no interest or late fees on access to earned pay.”
Real wages are falling, so get over your debts
Josh Vernon continues: “Real wages are at their lowest point since late 2011 and most experts believe that this trend will not subside until the middle or end of 2023. Inflation in Australia and globally continues to rise and we are unlikely to have inflation within the RBA’s target range until next year.
“Despite an intense labor shortage that is driving up wages, wage increases are not yet in line with inflation. It will take a few years for real wage growth to catch up with inflation once inflation will reach the RBA’s target range. Most experts expect us to reach 2015 real wage levels in 2025 to 2026.”
Banishing financial stress involves getting a handle on any debt by being realistic about how much you owe and how soon you can pay it off.
“If you have multiple forms of debt, it can be helpful to create a list that ranks the debts from most expensive to least expensive. Then you can focus on paying off the most expensive debt first.
“Debt consolidation is potentially an option as well, which helps to reduce the financial complexity in an individual’s life. This complexity can lead to anxiety which can then translate into poorer financial decisions and outcomes.
“Most people get into debt out of necessity and sometimes those debts can pile up. Debt consolidation can mean just one regular repayment schedule, giving you a clearer idea of when and how you could finally free yourself from your debts.
“It can, however, cost more in interest if the interest rate is higher and/or the term of the loan is extended, so each individual must weigh what is best for their own situation.”
Case Study: Eliza Kiers
Eliza Kiers recently moved from London at sydney with her British partner and three children, to pursue their dream of buying a house in the hinterland of Byron Bay.
His current challenge is saving for a down payment on a house, while traveling the UK every few years, dealing with expensive rent in Byron Bay and dining at Byron Bay’s amazing restaurants (one of the reasons why they wanted to move there!).
When she discovered the financial wellness features of the Wagestream app, including “access to earned pay”, she was thrilled for the extra help in achieving this goal.
According to Eliza: “While I would like a pay rise, I don’t see how employers could make wages go up as fast as inflation! But any support or tools my employer can provide for me help with money management would be great, as I don’t think managing personal finances well comes naturally to everyone, helping employees learn these life skills would be a real benefit.
“A friend in the UK told me about access to earned pay, and to be honest I didn’t quite believe it at first. I spent the first week telling all my friends : ‘Is this real?! They give you access to your money right away!’ It’s really crazy that more employers don’t offer it!
“When we moved to Byron Bay, I was short on funds because I hadn’t yet received my first Australian paycheck, so I used Earned Wage Access when we needed to pay a rental deposit on the property we now live in, same day we found it.It was much cheaper, smarter and easier than using a credit card or loan.
“Discipline is not my strong point! I have automatic transfers set up directly from my payroll, so I don’t even realize I’m putting money aside. On the Wagestream app, I can see how much I’ve earned each day, and watch it go up – I find it really motivating It’s like a Fitbit tracker except for my munited.”
salaryflow (www.wagestream.com/au/) is the financial wellness app founded by charities, designed for employees and built around compensation and making work more inclusive, fair and rewarding for one million people – giving them access to financial services fair based on their remuneration.
Workers use Wagestream to choose their own pay cycle, manage their budget, save for bad weather, chat with a personal financial coach, and get fairer deals on financial products – all in one app, with no changes to payroll.
Wagestream is guided by a social charter: every service it provides must measurably improve financial well-being. Over 70% of people using Wagestream feel more in control of their money, resulting in a happier, healthier and more productive workforce.