Should you offer an employer financial wellness programme? The latest study, PwC’s Employee Financial Wellness Survey tracks the financial and retirem
Should you offer an employer financial wellness programme? The latest study, PwC’s Employee Financial Wellness Survey tracks the financial and retirement well-being of working U.S. adults nationwide and suggests that this move may be wise.
Employees care about employer financial wellness programme
55% of employees believe their employer cares about their financial well-being. Millennials (62%) are more likely to say that their loyalty to their company is influenced by how much the company cares about their financial well-being as compared to Gen X (50%) and Baby Boomers (36%). Millennials (72%) and Gen X (71%) are more likely to be attracted to another company that cares more about their financial well-being than Baby Boomers (45%).
Employers benefit from employer financial wellness programmes too
The stunning research has found that 33% of workers are distracted by personal financial issues, with 46% of those distracted by financial stress say they spend three hours or more each week dealing with related issues at work.
Not only is that a lot of productive time to potentially be giving up, but it’s also the sort of habit that could cause those already plagued with financial anxiety to compromise their job security.
Financial employee benefits – impact by generation
Should you offer an employer financial wellness programme? The survey took a look at the interest in financial employee benefits by each generation. Here are the results:
- 67% of Millennials, 62% of Gen X and 61% of Baby Boomers believe their employer’s benefit plans are competitive with those offered by other organizations.
- 70% of Millennials, 71% of Gen X and 75% of Baby Boomers say they review their benefit elections every year and make changes if needed.
- 75% of Millennials, 75% of Gen X and 85% of Baby Boomers say they have a good understanding of employer benefit and savings plans and the role those plans play in their overall financial well-being.
- 76% of Millennials, 68% of Gen X and 57% of Baby Boomers say they’ve used the services their employer provides to assist them with their personal finances.
How can an employer financial wellness programme help employees?
When asked about their employer financial wellness programme has helped them:
44%–Get my spending under control
13% Better manage healthcare expenses/save for future healthcare expenses
26%–Better manage my investments/asset allocation
44%–Prepare for retirement
35%–Save more for major goals (purchases, home, education)
33%–Pay off debt
Financial wellness has changed
The survey has shown that to respondents, financial wellness now means freedom from financial stress and debt, enjoying life, and being prepared for emergencies. Surprisingly, very few employees of any age defined financial wellness in terms of retirement – which has historically been the focus of most employer financial education programmes. Forward-thinking companies have taken note, and in recent years some have expanded the focus of their programs to encompass a broader view of employee financial wellness.
Employees are extracting retirement money early
Depleted retirement funds More Millennial and Gen X employees are withdrawing money from their retirement plans than we’ve seen in prior years—around one-third of Millennial and Gen X employees have already withdrawn money from their retirement plans and about half think it’s likely they will need to do so in the future. And those employees who are stressed about their finances, impacted by student loans, or supporting a parent or in-law are twice as likely to use their retirement savings before retirement. This is a particularly concerning trend given the financial challenges younger employees will face in the future due to disappearing defined benefit pension plans and rising medical expenses.
Worryingly, one in four employees (25%) is not currently saving for retirement. Among the 25% of employees not currently saving for retirement, once again, the most frequently cited reason is too many other expenses, followed by debt.