Scots less financially prepared for crisis than UK as whole

The coronavirus crisis has brought into sharper focus a lack of financial preparedness, with the Scottish level much lower than that of the UK, according to a new report from Close Brothers.
Employers that provide financial wellbeing support are likely to increase loyalty and respect, Close Brothers says. Picture: John DevlinEmployers that provide financial wellbeing support are likely to increase loyalty and respect, Close Brothers says. Picture: John Devlin
Employers that provide financial wellbeing support are likely to increase loyalty and respect, Close Brothers says. Picture: John Devlin

The Changing Trends of Financial Wellbeing study of staff in businesses with a workforce of more than 200 found that 54 per cent of UK workers felt financially prepared for the crisis, but 20 per cent admitted to being financially unprepared.

In Scotland, only 37 per cent felt prepared for the crisis, and 26 per cent felt actively unprepared. While across the UK, half of employees have or plan to make changes to their financial preparedness, this rose to 61 per cent in Scotland.

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In terms of actual behaviour – changes made or planned to be made – Scots are more likely to keep a closer eye on their spending (at 59 per cent versus 54 per cent for the UK), save more into an emergency fund (50 per cent versus 46 per cent), and save more into their personal pension (17 per cent versus 13 per cent)

They’re less likely to write or update their will (17 per cent versus 19 per cent), hold more investments in cash (13 per cent versus 14 per cent), and far less likely to get a lasting power of attorney in place (4 per cent versus 10 per cent at a UK-wide level).

Jeanette Makings, head of financial education at Close Brothers, said: “The coronavirus crisis has drastically changed all aspects of life as we know it, but it has also brought a sharper focus on money, particularly in how prepared we are to weather unexpected financial events.”

She also said there is more work to be done with individual employees and via their employers to support improved financial resilience.

“There remains a huge amount of uncertainty around the short, medium, and longer-term impact of the coronavirus pandemic on individuals and businesses... Financial stress can affect mental health and an individual’s engagement and performance, so impacting business results.

Employers that provide financial wellbeing support, particularly during the most challenging of times, are likely to increase loyalty and respect as well as offering the support to encourage better financial futures for their employees.”

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