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Employee Credit Card Debt: 4 Simple Ways To Help

Employee Credit Card Debt: 4 Simple Ways To Help

by | Dec 17, 2024 | For Employers

Employee credit card debt is a significant issue among American workers. The average American’s debt balance reached $6,380 as of Q3 2024, according to TransUnion. One in five credit card users are maxed out, and 8.8% of credit card debt transitioned into delinquency during the same period. Credit card debt has increased by 48% since 2021, largely caused by post-pandemic spending and inflation.

This financial burden weighs heavily on the mental health of your workforce. Nearly half of those struggling with employee credit card debt report sleep issues, anxiety, and even depression. These struggles can spill over into the workplace, hindering your team’s productivity. According to research published in the Journal of Business and Psychology, employees dealing with financial stress are 11 times more likely to report being less effective at work.

By offering the right support, you can empower your employees to regain control over their finances, improve their overall well-being and boost your team’s wellbeing. Here are four key ways to help them manage their employee credit card debt.

A stat about employee credit card debt

1. Educate workers on how to handle employee credit card debt

Financial literacy is essential for managing and reducing credit card debt. However, 90% of Americans are unaware of how credit cards even work, especially when it comes to negotiating terms and conditions. Filling this information gap is essential to reducing misspending. Research from InCharge Debt Solutions has shown that individuals with higher financial literacy are less likely to engage in costly behaviors, such as paying only the minimum balance or incurring late fees.

Employers can help bridge this gap by:

  • Offering comprehensive financial education services such as Best Money Moves
  • Hosting financial workshops on debt management
  • Teaching employees how to consolidate high-interest debt into lower-interest loans—an important step, considering the average U.S. credit card APR is 24.62%
  • Providing resources on how to negotiate lower rates with credit card providers.

A solid financial foundation can help your employees size up their credit card debt and then strategically approach repayment.

2. Encourage budgeting and emergency savings for those with credit card debt

Budgeting and emergency savings are critical for financial stability. Yet, according to NerdWallet, only 74% of Americans actively follow a budget. Employers can help fix this problem by fostering a culture that incentivizes financial planning.

By offering resources to help employees create a budget and stick to it, employers can help employees manage everyday expenses and prepare for emergencies. Investing in employee wellness can also boost team morale.

For employees struggling to save, automated payroll savings programs may help employees to store some of each paycheck in a dedicated account with minimal effort. Employees face less stress and greater stability when they take the time to build better financial habits. This benefits both their personal lives and workplace performance.

3. Consider employer-sponsored employee credit card debt assistance programs

Employer-sponsored debt assistance programs allow you to directly address employee credit card debt. These programs vary, but many offer direct contributions or match payments toward employee credit card debt. This helps to reduce their balances more quickly. Debt assistance programs are highly sought after. When surveyed by the Financial Health Network 62% of respondents reported that they would be more likely to stay at a job that offered useful debt-related benefits.

4. Offer flexible payroll options

Many employees struggle to make ends meet on a traditional biweekly pay schedule, particularly the 78% who live paycheck-to-paycheck. Flexible payroll options like earned wage access programs can offer relief for these employees by allowing them to access their earnings before payday in case of an emergency. This approach can help employees pay their bills on time, avoid late fees and reduce their reliance on credit cards for everyday expenses.

Not only can flexible pay options help your employees in a financial bind, but they also help employees feel more in control of their finances, reducing stress.

Supporting employees in managing credit card debt isn’t just a kind thing to do for your employees — it’s a smart move for your business. When employees have the tools to take back control of their finances, they’re less stressed, more focused and better equipped to do their job.

Help your employees with their credit card debt with Best Money Moves!

Best Money Moves is an AI-driven, mobile-first financial wellness solution designed to help employees with varying levels of financial knowledge dial down their most top-of-mind financial stresses. As an easy-to-use financial well-being solution, Best Money Moves offers comprehensive support toward any money-related goal, ranging from debt management to purchasing a home. With 1:1 money coaching, budgeting tools and other resources, our AI-driven platform is designed to help bolster employee financial wellbeing.

To learn more about Best Money Moves Financial Wellness Platform, let’s schedule a call. Contact us and we’ll reach out to you soon.

5 Easy Ways to Improve Employee Cybersecurity Around the Holidays

5 Easy Ways to Improve Employee Cybersecurity Around the Holidays

by | Nov 20, 2024 | For Employees

The holiday season is fast approaching. With it comes an increase in online shopping — which could mean an increase in cybercrime. Online sales are expected to grow by 4.8% this holiday season, according to Salesforce. Cybercriminals will look to exploit the surge in digital transactions. Employee cybersecurity should be a high priority for business owners. A data breach could result in the theft of customer information, financial losses and reputational damage.

All businesses are susceptible to cybercrime. But for companies with remote workforces, the holidays present an additional challenge to ensure employee cybersecurity remains strong.

As of August 2023, over 10% of all workers in the U.S. were entirely remote. An even larger percentage adopted hybrid schedules. This shift in work environments has created new vulnerabilities as remote workers are increasingly targeted by cybercriminals. According to a study by Barracuda Networks, 46% of businesses experienced a cybersecurity incident within the first two months of shifting to remote work.

With increased online shopping and the rise in remote work, business owners must help their employees avoid cybercrime. To protect your business during this high-risk time, here are five easy ways to improve your employees’ cybersecurity around the holidays.

1: Improve employee cybersecurity by educating employees on how to protect card data

When it comes to employee cybersecurity, knowing how scams work is half the battle. Online criminals often use a tactic known as phishing. Phishing scams use fraudulent websites, emails or text messages to steal credit card details or login credentials. According to the Federal Trade Commission, the most effective way to avoid falling victim to these scams is to recognize potential phishing attempts. You want to avoid suspicious links or attachments.

Encourage employees to only use trusted websites when making purchases. They should ensure that the site URLs begin with “https” for secure transactions. Never provide personal or financial information through text or email. Training seminars on recognizing phishing scams or even simple written guides on protecting payment information can help minimize the risk to both the employee and the company and support your employees’ cybersecurity.

2: Use spam filters and security software to avoid phishing scams

Phishing attempts increase during the holidays. This mirrors the uptick in online shopping. It’s critical to put proper tools in place to defend against cybercrime. Bolster employee cybersecurity by using spam filters and advanced security software. These help block malicious emails before they even reach your employees’ inboxes.

Phishing emails are designed to look legitimate, appearing as if they are from trusted sources like retailers or financial institutions. This can make them hard to spot. Spam filters and security software help remove and flag these before they enter your inbox. Train employees to recognize common phishing techniques, such as emails from generic domains like Gmail, Hotmail or Yahoo, that include urgent requests for sensitive information.

3: Advise your employees to use strong passwords and update them regularly.

The simplest way to protect your business from cyber threats is to enforce strong password policies for any important accounts. This strategy is also one of the most effective. Employee cybersecurity improves when employees are required to create complex passwords with at least twelve characters that include a mix of letters, numbers, and special characters.

Additionally, employees should avoid using the same passwords across multiple accounts, as one breach could leave them vulnerable to data leaks from multiple platforms. Updating these passwords regularly can help ensure the privacy of your accounts if they are ever compromised. Password managers can create, store and regularly update strong passwords for you.

4: Establish emergency response procedures in the event of an employee cybersecurity lapse

While it’s important to focus on prevention, these measures may not cover everything and businesses should be prepared to act quickly if a cybersecurity breach does occur to protect employee cybersecurity.

Establishing clear emergency response procedures can help ensure that employees know exactly what to do in the event of a data breach, malware infection or other cyberattack. This should include steps such as immediately disconnecting compromised devices from the company network, contacting your IT team and standardizing protocols for recovering data. According to IBM, creating formal incident responses helped reduce breach costs by half a million US dollars on average.

Employees should check if their device seems sluggish, if their battery is draining too quickly or if their device is making strange noises. All of these factors can indicate their device’s communications are being interfered with. Taking a proactive response by having employees report any suspicious activity, even if they think it’s minor, can help prevent some cybersecurity catastrophes before they spread.

5: Upgrade your employee cybersecurity by investing in cybersecurity tools

Investing in advanced cybersecurity tools such as cyber insurance or educational tools can give your business an extra layer of protection during the holidays. To help your employees’ cybersecurity, look for tools to prioritize security and help diagnose potential email threats. Another option to consider is cyber insurance, which can cover financial losses resulting from data breaches such as legal fees, notification expenses for affected customers, system repairs and even public relations efforts to manage reputational damage.

Cybercriminals are relentlessly innovative in their pursuit of company data as cybercrime costs the world over $10 trillion. The most practical way to avoid adding to that toll is by keeping your employees educated and responsible with their computer usage.

Financial Wellness Company Best Money Moves Wins Social Impact Award

Financial Wellness Company Best Money Moves Wins Social Impact Award

by | Oct 17, 2024 | For Employers

On October 16, 2024, Best Money Moves Founder & CEO Ilyce Glink accepted the Social Impact Award from Smart Business Dealmakers at their annual Chicago conference. This is her acceptance speech.

Marne, thank you for that gracious introduction. And, thank you to the nominating committee for honoring Best Money Moves with a 2024 Dealmakers’ Social Impact award.

When I began my career in financial journalism, appearing on the radio, television and writing hundreds of newspaper articles and columns each year, an advisor of mine told me I needed to have a motto for my career. After trying out a few, I landed on this: Helping people make smarter decisions with their money.

As is so often the case these days, my career has expanded from its service journalism beginnings. I started a second company, Think Glink Media, to help connect financial services companies in better, smarter, more innovative ways with the clients and customers they serviced. I co-founded a third company that connected a Fortune 100 healthcare company with healthcare consultants, experts, influencers and healthcare journalists. Once that was sold, I started thinking about how consumers were experiencing financial stress in the wake of the Great Recession. And, given that nearly 70% of our population lives paycheck-to-paycheck today, including a third of those earning more than $250,000 per year, they still are.

That’s the foundation of Best Money Moves, my financial wellness company. We help employers measure their employees’ level of financial stress with a variety of assessment tools, then leverage artificial intelligence to help personalize the information, tools, and solutions we push to each employee. (We use Anthropic, by the way, since my son works there and, well, family first!) And, we can even send employees information about their own company’s benefits. So they make smarter financial decisions every day.

For employers, we offer an unparalleled level of customization and curation out–of-the-box, the ability to build in your own benefits, grouped for specific portions of your workforce, as well as analytics that would be difficult to get anywhere else.

Today, around 1,000 companies trust Best Money Moves with their employees’ financial wellbeing. What I’ve learned is that when employees feel less financial stress, there’s a real ROI for employers: Less chronic illness and addiction issues, fewer heart attacks, better health outcomes, sure. Also, less turnover and more focused, productive employees. Their employees feel happier and sleep better. Bonus: They’re less grouchy, too.

Since Black and Brown families have about one-tenth the wealth of White families, we’ve found creative ways to work with nonprofits, religious organizations, colleges and universities, local governments and for-profit companies enmeshed in those communities. We’ve developed give-back programs to help fund their initiatives. We’ve created special versions of Best Money Moves, which we call “Pro,” to cater to micro-businesses and start-ups packed with partnerships that we believe will resonate with those employers and their employees. And, we work to make sure everyone who needs access to Best Money Moves has it.

The feedback, testimonials, and ratings we’ve received make it all worthwhile. We are helping people make smarter decisions with their money everyday. Which is enormously gratifying. Less so is the hard work we’ve done over the past eight years to educate employers on the very real benefits of a less financially-stressed workforce.

Financial stress is the #1 reported workplace stress. Financial wellness has been the #1 requested benefit for the past few years. We must all look for ways to turn down the volume on our highly stressed workforce and find opportunities to help our employees feel better about themselves, their earning potential and their financial futures.

I have a few people I’d like to thank starting with our incredible Best Money Moves team, who make us look good every day, my family for all their support, and in particular, I’d like to thank my husband, Sam, who always believes my wildest dreams will come true.

In closing, I’d like to leave you with a quote from the late Herb Kelleher, co-founder, CEO and Chairman Emeritus of Southwest Airlines until his death in 2019: Your employees come first. And if you treat your employees right, guess what? Your customers come back, and that makes your shareholders happy. Start with your employees and the rest follows from that.

Thank you.

Financial Stress In 2024: Revealing Insights About Americans and Money

Financial Stress In 2024: Revealing Insights About Americans and Money

by | Jun 25, 2024 | Blog

Financial stress in 2024: Revealing insights about Americans and Money. Financial stress is still a major struggle for employees across all industries. Here are the top statistics updated for 2024.

Once again, employee financial stress is on the rise. Americans are grappling with higher prices, uneven wage growth and record-high credit card debt. Globally, extremely high inflation has pushed food, fuel and housing costs higher. Household debt coming into 2024 soared to $17.3 trillion, with a notable 16.6% increase between 2022 and 2023 alone. [1]

The Financial Health Pulse 2023 U.S. Trends Report, documents that 17% of Americans are now considered “financially vulnerable,” meaning they struggle to meet expenses, have little to no emergency savings, and carry burdensome debt levels. [2]

Compounding these challenges are rising interest rates and the burden of $1.74 trillion in student loan debt repayments. These are collectively straining employee finances and exacerbating overall financial pressure. [3]

Such challenging conditions have had serious implications for Americans’ financial security. Study after study finds that more than half of Americans live paycheck-to-paycheck, including those making over six figures. In fact, data from PYMNTS and LendingClub revealed that 42% of workers earning more than $100,000 per year still struggle with financial insecurity. That underscores the widespread impact of ongoing economic strains on individuals across income brackets. [4]

Financial stress linked to workforce financial (un)wellness

Long-term financial stress has been consistently linked to reduced employee performance. Approximately one-third of employees acknowledge that financial worries affect their ability to engage at work. U.S. employees feel increasingly burdened by financial concerns, spending an average of 8.2 work hours per week dealing with personal financial issues.

In this way, the rise in employee financial stress poses a significant challenge for employers, as it undermines employee well-being and organizational success. Persistent financial strains can result in decreased productivity and diminished employee morale, ultimately impeding the organization’s overall performance.

Recognizing the critical role of supporting employee financial wellness, employers must take proactive measures to alleviate financial stress and fortify the long-term viability of their business.a fact about financial stress

Generational Perspectives: Financial Stress Across Millennials and Gen Z

Around 57% of Americans say finances are the top cause of stress in their lives. [5] However, younger workers struggle even more than their peers: [6]

  • 54% of Millennials and 47% of Gen Z respondents say that financial uncertainty causes feelings of depression. In contrast, just 20% of Baby Boomers and 37% of respondents harbor that sentiment. [7]
  • 35% of Gen Z says the cost of living (housing, transportation and utility bills) is their most pressing concern and 51% say they live paycheck-to-paycheck; 42% of Millennials say the cost of living is their most pressing concern and 52% say they live paycheck-to-paycheck. [8]
  • While Americans of all ages struggle to pay off debt, Gen Z and Millennials have seen the largest average increases in total debt over the past couple of years. Gen Z saw a 62% increase in credit card debt between March 2022 and February 2024. Millennials saw a 49% increase. These two generations also have had the steepest decline in credit score health. [9]
  • A top concern for many Millennials and Gen Z employees remains their looming student debt. As of September 2023, about 43% of Millennials and 28% of Gen Z carried at least some student loan debt. In many cases, these loans have affected the borrower’s ability to meet financial goals. [10]
  • About 60% of US adults with student loan debts have put off making important financial decisions due to their debt. Emergency and retirement savings have taken the biggest hit. When surveyed, 27% of respondents delayed saving for emergencies and 26% delayed saving for retirement. [11]
  • While the majority of Millennials want to buy a home, 48% don’t believe homeownership is affordable for their generation. A staggering 96% of Millennial buyers are concerned about purchasing a home. [12]

Generational Perspectives: Financial Stress Across Baby Boomers & Gen X

Baby Boomers tend to report the least amount of financial stress, with only 19% reporting extreme financial stress as of January 2023. [13] This generation also carries a lower average mortgage debt than Millennials or Gen X. However, they have the second-highest credit card debt of any age demographic, after Gen X. 

Among the different generations, Gen X exhibits the highest levels of financial worries, with a notable 50.2% expressing feelings of financial insecurity. [14] Almost half of working Gen Xers report feeling significantly behind where they should be with their retirement savings and over half are uncomfortable with their level of emergency savings. Across all generations — from Gen Z to the Silent Generation — financial wellness and security during retirement remains a primary concern. [15]

Understanding the Impact: How Financial Stress Threatens Employee Wellbeing

One of the most concerning elements of financial stress is its negative relationship to physical and mental health. People who are financially stressed are much more likely to struggle with substance abuse, be overweight and have worse health outcomes than their non-stressed peers. [16] They’re also much less likely to be engaged at work. 

74% seek financial guidance when dealing with financial decisions, crises, or life. However, only 2 out of 5 employers offer financial wellness programs.

With employees under continued economic strain, other cracks are emerging:

  • Many insured adults said they or a family member had delayed or skipped necessary health care or prescription drugs because they could not afford the costs.  In the past year: 29% with employer coverage, 37% covered by marketplace or individual-market plans, 39% with Medicaid, and 42% with Medicare;
  • 56% of employees said financial stress affected their sleep, 55% their mental health, 50% their self-esteem, 44% their physical health, and 40% their relationships at home. [17]

Employers play a crucial role in understanding and addressing this intersection of financial stress, physical and mental health and workplace engagement. Companies are increasingly called upon to equip their workforce with the tools and resources needed to navigate financial challenges and alleviate the stressors contributing to adverse health outcomes.

Assessing the Influence of Financial Stress on Workplace Turnover & Retention

There’s more bad news for companies struggling to keep employees. As workers face heightened financial stress, there is a pressing need for companies to step up and provide comprehensive support. Otherwise, employers risk losing these employees altogether.

  • Financially-stressed employees are twice as likely to change jobs as those who aren’t. [18]
  • 73% of financially stressed employees say they would be attracted to another employer that cares more about their financial well-being.
  • Among financially stressed employees, 56% spend 3 or more hours per week at work dealing with or thinking about personal finance-related issues.
  • Only 54% of financially stressed employees think there is a promising future for them at their current employer, compared to 69% of not financially stressed employees.

Recognizing the need for comprehensive support of employees under financial stress, the focus shifts to employers’ ability to meet these needs effectively. By acknowledging the demand for broader financial wellness initiatives, companies can proactively engage employee satisfaction and retention, paving the way to a more resilient and engaged workforce.

Beyond Retirement: Meeting the Full Spectrum of Employee Financial Needs 

The demand for financial wellness support underscores a gap in employer offerings. Many companies only offer retirement support and safety net insurance. However, employees increasingly express dissatisfaction with these limited provisions, highlighting the need for employers to take more comprehensive action in addressing financial stress within their workforce. As employers, it is crucial to recognize and respond to employees’ concerns by expanding financial wellness initiatives. 

Seventy-six percent of employees feel their employers should take responsibility for their financial wellness. And 74% actively seek financial guidance for various financial decisions, crises or life events. [19]  However, despite this clear demand, only 2 out of 5 employers offer financial wellness programs, even though 68% of employees utilize the financial wellness benefits when provided.

The absence of such support can be a deciding factor for many employees. Some 73% of financially stressed employees saying they would be attracted to another employer that cares more about their financial well-being, compared to just 54% of non-financially stressed employees. [20]

It is imperative for employers to recognize their role in equipping employees with basic money management skills and money coaching, budgeting help and other resources that can help employees achieve their financial goals. Furthermore, the benefits are clear: 92% of employers who offer resources to manage overall well-being saw improvement in employee satisfaction. [21]

Best Money Moves can help. Personalized, gamified and easy-to-use, Best Money Moves helps employees budget, make better financial decisions and implement their personal best money moves to achieve their most specific financial goals.

About Best Money Moves

Best Money Moves helps your employees measure and dial down their financial stress, with measurement tools, 900+ written and video resources, and best-in-class voluntary benefits to supplement those you already offer. Depending on the version chosen, you may be able to integrate your own company benefits into the platform, personalizing the financial wellness journey your employees are on.

Call us for a demo and find out how adding a great financial wellness benefit can help improve retention, lower turnover and reduce healthcare costs.

To learn more about Best Money Moves Financial Wellness Platform, let’s schedule a call. Contact us and we’ll reach out to you soon.

1 Americans Are Carrying Record Household Debt into 2024, MarketWatch, 2024
2 Financial Health Pulse 2023 U.S. Trends Report, Financial Health Network, 2023
3 https://www.federalreserve.gov/releases/g19/HIST/cc_hist_memo_levels.html
4 New Reality Check: The Paycheck-To-Paycheck Report – Financial Distress Factors Edition, PYMNTS and LendingClub survey, 2024
5 2023 PwC Employee Financial Wellness Survey, PwC, 2023
6 2023 Gen Z and Millennial Survey, Deloitte, 2023
7 Millennials and Gen Zers Are Losing Sleep Due to Financial Anxiety, Money Magazine, 2023
8 2023 Deloitte Gen Z and Millennial Survey, Deloitte, 2023
9 Millennials and Gen Z face ‘snowballing and snowballing’ debt as high card balances and interest rates eat into their credit scores, Fortune, 2024
10 Which generation has the most student loan debt?, Bankrate, 2023
11 Survey: Student loans have delayed wealth-building for Gen Z and millennial borrowers, Bankrate, 2023
12 Millennial Home Buyer Report: 2024 Edition, Real Estate Watch, 2024
13 Debt and mental health statistics, Bankrate, 2023
14 2024 Survey: Generational Banking Trends, MarketWatch, 2024
15 2023 Workplace Benefits Report, Bank of America, 2023
16 Commonwealth Fund 2023 Health Care Affordability Survey, Commonwealth Fund, 2023
17 2023 PwC Employee Financial Wellness Survey, PwC, 2023
18 2023 PwC Employee Financial Wellness Survey, PwC, 2023
19 2023 Workplace Benefits Report, Bank of America, 2023
20 2023 PwC Employee Financial Wellness Survey, PwC, 2023
21 2023 Workplace Benefits Report, Bank of America, 2023
The State of American Financial Wellness and Financial Stress, 2022

The State of American Financial Wellness and Financial Stress, 2022

by | Dec 13, 2022 | Blog

The State of American Financial Wellness and Financial Stress, 2022. The Covid-19 pandemic changed Americans’ relationship to their personal finances. Here are the top financial wellness and financial stress highlights from 2022.

The Covid-19 pandemic has dramatically changed Americans’ relationship to their personal finances. Study after study has found that more than half of Americans live paycheck-to-paycheck. One- third of those earn more than $100,000 per year, but still struggle to make ends meet. Indeed, midway through 2022, a new survey found that nearly one in three consumers earning $250,000 or more annually is living paycheck-to-paycheck.[1] Another study[2] found that 75% of U.S. employees are facing at least one source of major financial stress and are spending 9.2 work hours per week dealing with their finances. 

Globally, consumers face extremely high rates of inflation while food, fuel and housing costs soar. Household debt climbed past $16 trillion in the second quarter, with credit card balances surging 13% in the past year. Rising interest rates strain pocketbooks, and that doesn’t include $1.6 trillion in student loan debt repayments, which have been suspended since the start of the pandemic, in 2020.

Clearly, personal financial stress is on the rise.

Generational Financial Stress

Americans from all generations struggle with financial stress: [3]

  • 63% of all employees say their financial stress has increased since the pandemic started
  • 42% of full-time employees struggle to pay household expenses on time each month
  • When it comes to personal finances, 87% of employees want help and 84%[4] believe their employers should be responsible for their financial wellbeing.

But, it appears that younger workers are struggling more:[5]

  • The majority of Gen Z and Millennials (about 70%) have high financial stress due to the pandemic;
  • 29% of Gen Z says the cost of living (meaning housing, transportation and bills) is their most pressing concern and 46% say they live paycheck-to- paycheck;
  • 72% of U.S. millennials carry some form of non-mortgage debt, with the average millennial owing $117,000;[6]
  • 63% of Millennials believe it will take them one to five years to pay off their debt, 9% think it will take them more than 10 years, and 6% think they’ll never pay it off; [7]
  • And while Millennials and Gen Z want to buy homes, Gen Z is currently unable to afford a median priced home in any of the top 100 markets. Millennials can only afford a median priced home in 34 of the biggest 100 metro areas.[8] 

Millennials, Gen Z and Student Loan Forgiveness

A top concern for many Millennials is their looming student debt. About 30% of Millennials carry a student loan, and in many cases, these loans have affected their ability to meet financial goals.[9] Over 30% of Americans put off buying a home because of looming student debt, and almost 25% of Americans have limited their retirement and emergency savings due to outstanding student debt.[10]

In August, President Biden announced widespread student loan forgiveness up to $10,000 of debt for borrowers who earn less than $125,000 per year or married couples (or heads of households earning less than $250,000). An estimated 37 million Americans out of 45 million who hold student loan debt may be eligible.

While those eligible for student loan forgiveness will not have to pay federal income tax on the amount that is forgiven (which the IRS treats as a gift), more than a dozen states may impose state income tax on the forgiven amount.

Baby Boomers, Gen X and Financial Stress

Conversely, Baby Boomers tend to report the least amount of financial stress. In fact, just 14% of Baby Boomers say that debt has affected their quality of life, and more than half say they have control over their debts.[11]

Gen X falls somewhere in the middle. They carry looming debt and financial stress, but are working to dial it down. In 2021, almost 48% of Gen Xers reported a good or great sense of financial wellness, up from 38% in 2020. This is the largest percentage point increase for any generation for reported financial wellness.[12]

However, across all generations — from Gen Z to the Silent Generation — financial wellness and security during retirement remains a primary concern.[13] 

Turnover, Retention & Financial Stress

There’s more bad news for companies struggling to keep employees. Several recent studies found that employees are more likely to look for a new job if they’re financially stressed.

  • Financially-stressed employees are twice as likely to change jobs as those who aren’t;
  • Among 44% of employees looking to change jobs[14], 65% say the reason is financial: they need more money;
  • 76% of employees looking to change jobs would prefer to work for a company that cares about their financial wellbeing;
  • 49% of employees have experienced a financial shock, including a significant medical expense (31%) followed by working hours cut (23%) fraud (15%) and the impact of divorce (13%).

Moreover, there’s a stark disconnect in what people want in financial wellness programs versus what they’re being given. Employers are well positioned to help change that. 

Financially Stressed Employees Have Worse Health Outcomes

One of the most concerning elements of financial stress is the relationship to physical and mental health. People who are financially stressed are much more likely to struggle with substance abuse, be overweight and have worse health outcomes than their non-stressed peers. They’re also much less likely to be engaged at work. But with inflation running rampant, other cracks are emerging:

  • One-third of those who find it difficult to afford healthcare deferred appointments or treatments and say their health suffered because of it;
  • For employees whose financial stress increased over the pandemic, about 60% avoided seeking medical treatment due to high costs;
  • Among financially-stressed employees, 49% said that money worries had a severe or major impact on their mental health in the past year.[15] 

One way to improve workforce financial wellbeing is to help employees make a smarter decision about healthcare coverage. Best Money Moves’ partners have seen employees save an average of $1,300 per year simply by making better decisions based on actual claims data, while employers have seen usage go up and, in some cases, overall costs decline.

Financial Health of Americans

About 35 million Americans are estimated to be financially vulnerable, which means they’re struggling with almost all aspects of their financial lives. Comparatively, about 131 million Americans say they’re coping financially, while struggling with some aspects of their financial lives.[16]

Many societal and pandemic-related trends have shaped the financial challenges people face (e.g., rising costs of living, workplace instability, earning gaps, etc.).

Although almost 80% of Americans have an emergency fund, less than half can cover six months of expenses. And even those with high financial wellness, one in five cannot easily cover six months of expenses.[17] All of this paints a worrying picture of financial health for most Americans, especially with many economists forecasting a recession in 2023. 

Employees want more than just retirement assistance

One of the most-requested benefits in 2022 is financial wellness support. Companies tend to only offer retirement plans and safety net insurance. Employees don’t think it’s enough.

Over 80% of employees want personal finance help from their employers, beyond the typical retirement plans and safety net insurance.[18] Employees need to learn basic money management and prefer to get money coaching, budgeting help and other resources that can help them achieve their financial goals.

The benefits are clear: employees who participate in financial wellness programs are twice as likely to have high financial wellness than those not offered such resources (32% vs. 15%).[19] The ROI for employers includes reduced turnover, improved retention and productivity, fewer workplace accidents and healthier employees, among other benefits.

Best Money Moves can help. Personalized, gamified and easy-to-use, Best Money Moves helps employees budget, make better financial decisions and implement their personal best money moves to achieve their most specific financial goals.

About Best Money Moves

Best Money Moves helps your employees measure and dial down their financial stress, with measurement tools, 900+ written and video resources, and best-in-class voluntary benefits to supplement those you already offer. Depending on the version chosen, you may be able to integrate your own company benefits into the platform, personalizing the financial wellness journey your employees are on. Call us for a demo and find out how adding a great financial wellness benefit can help improve retention, lower turnover and reduce healthcare costs.

To learn more about Best Money Moves Financial Wellness Platform, let’s schedule a call. Contact us and we’ll reach out to you soon.

1 New Reality Check: The Paycheck-To-Paycheck Report – Financial Distress Factors Edition, PYMNTS and LendingClub survey, 2022
2 https://www.sofi.com/sofi-at-work/workplace-2022/
3 2021 PwC Employee Financial Wellness Survey, PwC, 2021
4 https://www.sofi.com/sofi-at-work/workplace-2022/
5 https://www.forbes.com/sites/markcperna/2022/05/23/deloitte-almost-half-of-gen-z-workers-live-with-financial- anxiety-every-day/?sh=3ecd0cd97073
6 https://www.realestatewitch.com/millennial-debt-2022
7 https://www.realestatewitch.com/millennial-debt-2022
8 https://www.point2homes.com/news/us-real-estate-news/unaffordable-housing-by-generation-100-counties.html
9 https://educationdata.org/student-loan-debt-by-generation
10 https://www.cnbc.com/2021/04/08/older-millennials-with-student-debt-say-their-loans-werent-worth-it.html
11 https://business.bofa.com/content/dam/flagship/workplace-benefits/id20_0905/documents/2021-WBR.pdf
12 https://business.bofa.com/content/dam/flagship/workplace-benefits/id20_0905/documents/2021-WBR.pdf
13 https://business.bofa.com/content/dam/flagship/workplace-benefits/id20_0905/documents/2021-WBR.pdf
14 https://www.wtwco.com/en-US/Insights/2022/06/2022-global-benefits-attitude-survey
15 https://www.pwc.com/us/en/services/consulting/business-transformation/library/employee-financial-wellness- survey.html
16 https://fhn-finhealthnetwork-assets.s3.amazonaws.com/uploads/2021/10/2021_Pulse_Trends_Report.pdf
17 https://www.tiaa.org/public/pdf/2022_financial_wellness_survey_final_results.pdf
18 https://www.brightplan.com/2021-wellness-barometer-survey
19 https://www.tiaa.org/public/pdf/2022_financial_wellness_survey_final_results.pdf