While many small-to-medium size employers don’t offer financial wellness benefits, the results of a new survey suggest there’s a clear contrast between those with a benefit and those without.
According to Ramsey Solutions’ 2022 SmartDollar Employee Benefits Study, starting to save for retirement is the top change employees are making as a result of their financial wellness benefit. Employees with a financial wellness benefit were also found to be much less stressed about money.
In fact, by using their financial wellness benefit, both long- and short-term savings were top areas of concern that employees improved. Here, the findings show that 29% started saving for retirement and 25% built up their emergency fund. And not only did employees start saving for retirement, but nearly a quarter (24%) of respondents say they had more clarity around how much they should be saving for retirement.
In addition, more than half of employees with a financial wellness benefit (53%) rank retirement planning as the most important feature. This finding was true even across generations, no matter how far they are from retirement (53% of Millennials, 53% of Gen Xers and 55% of Baby Boomers).
While employees feel strongly about retirement planning, the majority apparently still don’t feel like they’re preparing for their retirement well, with 6 in 10 saying they feel behind on their goals. In this case, Baby Boomers are ahead of their younger coworkers, as only 39% of Baby Boomer employees say they feel behind.
And not only do employees feel behind, but nearly half (48%) say they don’t have anyone they trust for advice about retirement. In fact, when employees have questions about their personal finances, they’re more likely to turn to their family (40%) or the internet (36%) for answers than to a professional financial advisor (33%).
The study is based on a survey of more than 3,000 full-time American employees working at organizations with 25 to 3,000 employees and receiving benefits through their employer. It looks at how employees feel about financial wellness benefits, the financial concerns they’re facing and other workplace trends.
Benefits Satisfaction
Those with access to a financial wellness benefit provided by their employer (46%) are more than twice as likely to say they are extremely satisfied with their current overall employee benefits package compared with those who don’t have access to one (21%).
Additionally, those employees with a financial wellness benefit (60%) were twice as likely to describe their personal finances as “better off than this time last year,” compared with those who don’t currently have a financial wellness benefit (30%). Even when they don’t have access to a financial wellness benefit, employees see the value one could offer—8 out of 10 employees agree that financial wellness is an important part of a comprehensive employee benefits package.
Employees’ Desires
Against the survey’s findings of ongoing financial struggles, most employees (73%) wish their employers offered more resources to help them manage their finances. Millennial workers especially are looking to their employer to help. According to the findings, 84% of Millennials say they wish their employer offered more resources to help them manage their finances.
In fact, financial wellness is among the top benefits that employees who don’t already have wish they did, according to the study. Currently, only 23% of employees have a financial wellness benefit from their employer.
Not surprisingly, of the different kinds of financial wellness benefits, large organizations were more likely to offer both financial planning resources and financial education resources to their employees. Only 12% of those working at small organizations currently have a financial planning benefit, compared with 15% of those at medium organizations and 22% of those at large organizations.
Among those who don’t currently have these benefits provided, employees wish they had access to perks programs for savings on purchases (14%), student loan repayment assistance (13%), financial hardship programs (12%), financial planning resources (12%) and financial education resources (12%).
“Employers can’t solve every problem their employees have, but they can create a culture of caring,” says Ken Coleman of Ramsey Solutions. “They can show their employees how to keep more of what they earn instead of throwing it all at consumer debt. They can increase 401(k) participation, help people retire with dignity, reduce expensive turnover, and win the recruiting war that’s going on out there right now.”
The findings are based on 3,090 full-time employees answering a 93-question survey at companies with between 25 to 3,000 employees who have benefits through their employers. Third-party research provider Dynata collected the data between Jan. 10–25, 2022.
- Log in to post comments