Paula Simmons: ‘Financial Wellness Is Peace of Mind’

In a perfect world, wouldn’t you love to have the ability to increase your employees’ wages in conjunction with inflation? Most employers wonder if increasing employees’ wages is actually possible in today’s work environment. But what is possible is giving employees access to helpful money management tools. When your employees understand basic budgeting, it can help reveal financial waste they might not have noticed before.

Establishing options like an emergency savings account or a special goal savings account helps employees secure financial resiliency and alleviate stress. Getting a handle on their day-to-day finances will also enable them to work towards long-term goals like preparing for retirement. In fact, here are eight retirement tips that have been proven effective.

Creating A Financial Roadmap

Some of us have experienced coming home from a long day to find an appliance has broken, a medical bill that came out of the blue, or a costly unexpected car problem that needs to be fixed right away. Then you lie awake at night trying to figure out payment options, only to wake up exhausted and more stressed. By default, a lot of people often charge these unexpected expenses to a credit card or need to secure a loan to make a payment. All of these things can result in workplace distraction, and even the smallest mistakes can result in dire consequences. Does this sound familiar?

We all know we should save money. However, when people hear the word budget, it often gives them the same feeling of going on a diet.  Often, the word budget is seen as restrictive and not for what it really is, a spending plan. Creating a budget gives you the road map to prepare for the unexpected and reach your dreams of going on vacation, purchasing a vehicle, owning your own home, and paying down debt. Taking the first step to creating a budget may seem like a daunting task, but it’s really as simple as asking yourself a few important questions.

• What do you currently have saved in your savings account?
• What debts do you have?
• What are your expenses?
• What is your income?

Your answers will enable you to find patterns in your spending habits to create a realistic spending plan or budget that will give every dollar a “job” of its own so you can reach the goals that you set.  

50/30/20 Rule

The next step is assigning each dollar its own job. One of the most common budgeting methods that I highly recommend is the 50/30/20 rule.  Split your income in 3 ways.  50% will go towards necessities, things like housing, car payments, groceries, utilities, minimum debt payments, and insurance. Next, you’ll allocate 30% towards your wants.  These are the things that improve the quality of life, like travel, dining out, gym memberships, that morning coffee stop, or buying that mermaid dress for prom.  Most of the waste you discover when reviewing your spending habits will be in this category. The last 20% goes towards savings – starting that emergency fund, saving for retirement, investing, or turning one of those dreams you have into reality. This category can also be used for paying down debt.

This foundation of financial literacy has always been my passion and was strengthened with UECU’s commitment to helping those within the industry. UECU partners with companies to offer courses on Budgeting, Understanding Your Credit Score, Owning a Home, Saving for Retirement, and even How to Teach Financial Literacy to Your Kids.  For partnership information on how to offer this free financial wellness benefit to your employees, visit https://uecu.org/paula-simmons/.

Paula Simmons is a financial wellness facilitator, certified by the National Wellness Institute, and a national account representative for the Utilities Employees Credit Union. She was a featured speaker at the Eastern Energy Expo in Atlantic City, N.J., in May.

Photo provided by Paula Simmons.