Nest Insight has published its third briefing paper, which outlines that those financially “struggling” are starting to save.
Nest Insight has shared details of its third briefing paper, which indicates that its sidecar savings trial has benefited employees.
The report focuses on the experience of employees, sharing insights into people’s perceptions of and reactions to the saving tool, such as who is using it and how it’s being used.
Provided by the trial’s tech partner Salary Finance, the savings tool has been introduced in various workplaces as a benefit dubbed ‘Jars’.
Data has since revealed that six in 10 workers think that Jars could help them, rising to eight in 10 of those struggling with bills and financial commitments.
Due to the crisis over the last 18 months, the idea of saving has become far more important due to financial uncertainty, as 85% of employees said that they think saving for emergencies is important.
Perks of automatic payroll saving
Thanks to the automatic payroll savings, employees stated that they could take net-pay at face value, avoiding the need to actively account for money they were putting away or feeling the ‘loss’ of money after it has been ‘in their pocket’.
“These emerging insights from the trial are really encouraging,” said Jo Phillips, Director of Research and Innovation at Nest Insight.
“The evidence we’ve gathered so far suggests that the savings tool is bringing people into saving who may not have previously had any money put aside, and there are already anecdotal indications of a positive impact on financial wellbeing, resilience and confidence.”
Saving persistency increases
Once employees signed up to the Jars, Nest’s data found that users were saving persistently and just two percent of accounts closed. It also revealed that savers are actively engaging with their accounts, despite the effectiveness of the ‘set and forget’ payroll saving mechanism.
For example, 15% of Jars users have made a change to their regular payroll savings amount, while one in four users have made additional deposits outside of payroll.
Elsewhere, four in 10 users have made a withdrawal from their emergency savings account in order to help them manage financial struggles.
Commenting on these figures, Phillips added: “What’s particularly brilliant to see is that even at this early stage, people are actively using their emergency savings to help smooth their income or deal with financial shocks.
“Whilst the prevailing norm is often to celebrate increasing balances, success in emergency saving means using that money when needed, which may mean avoiding debts or high-cost credit.”