Blog Archives

How Financial Stress Affects Gen X at Work

by AllyMauch | Sep 4, 2019 | Blog

How financial stress affects Gen X at work. Gen X has the most overall debt compared to any other generation and they’re bringing their financial stress to work.

Gen X — roughly those between the ages of 38 and 58 — is often cited as the “forgotten generation” sitting between the more famed Millennials and Baby Boomers. However forgotten they may be, those in Gen X are facing a whole host of unique financial stressors that employers need to address.

In addition to carrying the most credit card debt and being the least happy at work compared to all other generations, Gen Xers are worried about being able to retire and only 60 percent feel confident in their finances. Below, we break down the top financial stressors affecting Gen X workers.

Gen X’s Credit Card Debt Is a Big Part of Their Financial Stress

Gen X has the most overall debt than any other generation, a significant portion of which comes from credit card debt. Those between the ages of 45 and 54 have an average of $9,096 in credit card debt, and people who are 45-44 have the second-highest level of debt — $8,235. Because credit card debt typically carries higher interest rates than any other debt, the debt problem facing Gen X is particularly harmful.

To make matters worse, a study from PwC found that a majority — 60 percent — of Gen Xers consistently carry balances on their credit cards and 2 in 5 find it difficult to make their minimum credit card payments on time each month.

How Financial Stress Affects Gen X at Work

Gen Xers also report feeling the least happy at work and a quarter note better job security as their top priority for achieving future financial goals. A mere 68 percent of Gen X workers feel happy at work, compared to 74 percent of boomers and 75 percent of Millennials

This discontent at work stems from a variety of sources, including a lack of respect from employers, limited opportunities for upward mobility and sparse management and development skills training. Further, Gen X’s workplace unhappiness directly connects to their financial stressors — about two-thirds say that their compensation at work is not keeping up with the rising cost of their living expenses.

Financial Stress and Retirement Savings

Gen X is advancing quickly towards retirement, but 67 percent say they are not confident that they will be able to retire when they want to and one-third have already withdrawn from their retirement funds to cover expenses.

More than half of Gen X report feeling significantly or somewhat behind on their retirement savings and 18 percent do not plan to retire at all, according to a survey from MetLife. Compared to Millennials and Baby Boomers, these numbers make Gen Xers the least secure in their retirement plans.

Gen Xers note financial matters as their main cause of stress, making financial wellness an essential workplace conversation given the stressors outlined above. Programs like Best Money Moves can help alleviate the problem for both employees and employers. Best Money Moves is a mobile, gamified and easy-to-use financial wellness program. It provides practical, unbiased help so employees can make smarter financial decisions and manage the debt they have.

More on Financial Stress

5 Must-Have Benefits for Millennial Employees

How Does Financial Wellness Affect Health?

5 Fast Financial Stress Statistics

Hiring Trends to Watch in 2020

What Is Financial Literacy and Why Is It Important?

4 Big Employee Benefit Trends for Family Planning

How Can Financial Wellness Be Improved?

Top 10 Employee Benefits for 2020

If you want to learn more about how Best Money Moves can bring financial wellness to your company download our whitepapers and sign up for a demonstration here.

Financial Wellness as an Employee Engagement Strategy

by ryanwangman | Sep 4, 2019 | Blog

Financial wellness as an employee engagement strategy. If you want to improve employees’ productivity, start with the heart of the problem.

If you’re looking for a way to improve your employees’ productivity, start with tackling their financial stress — not only will you bolster engagement, you’ll also boost your bottom line.

Financial Stress Is Affecting Employee Engagement

That’s because employee financial stress is costing American businesses $500 billion per year, according to a recent survey of over 10,000 Americans. Employee financial stress finds its way into the workplace, as workers spend an average of three hours a week thinking about their personal finances on the job.

According to the same study, that lost productivity represents between 11 and 14 percent of payroll expenses per employee, per year. Additionally, employees stressed by their personal finances report more than 56 percent more absences than their co-workers. For businesses that don’t provide financial wellness programs, this stress adds up and decreases their income.

This stress is felt across a variety of different areas. For instance, over two-thirds of financially stressed employees say they consistently carry credit card balances each month, according to research by PwC. Additionally, 68 percent of those employees have saved less than $50,000 for retirement.

Financial Wellness Programs Can Help With Employee Engagement

While the range of financial problems your employees are facing can vary — from a lack of retirement savings to mounting student loan debt — the first step to help them address the situation is to provide a comprehensive understanding of it. A majority of employees still want to make their own decisions when it comes to their financial lives — but they also want a resource that will help validate their decisions. The most desired employer benefit for one in four employees is a financial wellness program with access to unbiased counselors.

Among employees who were provided a financial wellness program by their employer, 71 percent say they’ve used the benefit, and the programs are particularly popular among Millennials and Baby Boomers. Usage of the programs is up as well, with just 49 percent of employees using these same programs in 2015.

Financial wellness programs give you a competitive advantage in the hiring market as well. Seventy-eight percent of employees who reported being stressed about their finances said they would be attracted to another company that cared more about their financial wellbeing.

Financial wellness programs like Best Money Moves can help. Best Money Moves is mobile, gamified and easy-to-use. It provides practical, unbiased help so employees can make smarter financial decisions and manage the debt they have.

Retirement Concerns Aren’t Boosting Contributions

by LizStevens | Sep 4, 2019 | Blog

Retirement concerns aren’t boosting contributions. Americans can expect to outlive their retirement savings by anywhere from eight to 20 years.

Retirees in the U.S. can expect to outlive their savings by anywhere from eight to 20 years, according to research by the World Economic Forum. Women have it worst and will outlive their retirement savings for at least two years longer than men.

Not saving enough for retirement is Americans’ biggest financial regret, yet less than 30 percent of workers have increased their retirement savings contributions rate this year. Over 20 percent of employees are saving less or not contributing to a retirement fund at all.

Why Aren’t Employees Boosting Retirement Contributions?

“The reasons Americans cite for not increasing retirement contributions indicate a continued lackadaisical approach to retirement savings – whether it’s complacency with current contributions, focus on other financial priorities, rising household expenses or just not getting around to it,” says Greg McBride, chief financial analyst at Bankrate.

Nearly 25 percent of employees didn’t raise retirement savings because they’re comfortable with their current contribution. Considering the $400 trillion global retirement savings gap, it’s worth wondering if those who are comfortable really have enough set aside to get them through retirement. Life expectancy for senior citizens has never been better, which means most Americans’ will need more money saved than they once thought, and that’s before factoring in costs for long-term healthcare.

Stagnant or declining income is the reason more than 20 percent of employees gave for failing to increase contributions to retirement funds in 2019. Over 15 percent of workers focused on another financial priority, like paying down credit card debt, before boosting retirement savings. More than 10 percent of employees blame rising household expenses for their failing to increase retirement contributions. Unexpected financial emergencies kept almost 10 percent of them from boosting retirement savings.

The most concerning response came from the more than 10 percent of workers who just haven’t gotten around to it. It was a more popular response for younger Millennials (16 percent) and households with lower-than-average income (16 percent) than for other groups.

“Saving for retirement needs to be made a bigger priority for the millions of Americans that aren’t saving, got started late, or are behind on their retirement savings,” McBride says.

More on Retirement, Savings and Financial Stress

How to Help Employees Save More for Retirement

Retirement Concerns: Is Financial Literacy the Solution?

How Do Employees Pay for Unexpected Expenses?

5 Fast Financial Stress Statistics

How Bad is the Student Loan Crisis?

5 Must-Have Benefits for Millennial Employees

The Top 3 Financial Stressors Affecting Gen Z

by AllyMauch | Aug 26, 2019 | Blog

The top 3 financial stressors affecting Gen Z. Gen Z is both the youngest and largest generation in the U.S., and they are beginning to enter the workforce with a whole host of unique financial stressors.

Generation Z — the generation immediately following Millennials — is the latest group entering the workforce, but work and money are already at the top of their list of stressors. According to the American Psychological Association, 81 percent of Gen Z adults are stressed about money, a staggering number compared to the 64 percent of all other adults who are similarly stressed.

Gen Zers are eager to reach their financial goals and have clear plans for the future, but a lack of financial literacy, the overwhelming burden of student loan debt and overspending are all holding this young generation back. Take a deeper look at the top financial stressors affecting Gen Z below.

Gen Z Needs Financial Literacy

In a study by EVERFI, only 33 percent of Gen Zers felt prepared to manage their money. The same study shows that this generation has a lack of knowledge regarding their personal finances: 9 in 10 have had experiences with a checking account, but less than 60 percent checked their bank account in the past year and only 40 percent have ever created or used a budget.

Unsurprisingly, these lackluster money management skills stem from an absence of financial literacy education for the youngest generation entering college and subsequently, the workforce.

Student Loan Debt Stress

The total student loan debt in the U.S. has reached nearly $1.6 trillion, making debt a pressing concern for all Americans, but particularly for those who are in college or recently graduated: Gen Z. Of the class of 2018, 7 in 10 took out student loans to cover their education, with an average debt of $29,800, according to research by Student Loan Hero.

With the cost of college continuing to rise, the student debt crisis is only worsening and a report by Brookings predicts more borrowers will default on their loans. As a result, over 40 percent of Gen Zers now identify student loan debt as a significant source of stress in a survey by Lifeworks.

Gen Z Overspending

Research by EVERFI found that 10 percent of Gen Zers buy things they can’t afford, and four in 10 don’t stop spending when resources are low.

Staggeringly high debt and a lack of financial education both contribute to this last Gen Z financial stressor — overspending paired with undersaving. One-third of Gen Zers reported feeling stressed about poor spending habits. The spending, paired with increasing debt, directly links to a lack of savings: almost 20 percent are not putting anything towards their savings each month.

This financial stress affects workers’ productivity and increases healthcare costs, hurting both employees and employers. Financial wellness programs like Best Money Moves can help. Best Money Moves is mobile, gamified and easy-to-use, with an emphasis on financial literacy and accessible tools that’s perfect for Gen Z. It provides practical, unbiased help so employees can make smarter financial decisions and manage the debt they have.

More on Financial Stress and Financial Wellness Programs

5 Must-Have Benefits for Millennial Employees

How Does Financial Wellness Affect Health?

5 Fast Financial Stress Statistics

Hiring Trends to Watch in 2020

What Is Financial Literacy and Why Is It Important?

4 Big Employee Benefit Trends for Family Planning

How Can Financial Wellness Be Improved?

Top 10 Employee Benefits for 2020

If you want to learn more about how Best Money Moves can bring financial wellness to your company download our whitepapers and sign up for a demonstration here.

3 Financial Stressors Affecting Every Generation

by ryanwangman | Aug 26, 2019 | Blog

3 financial stressors affecting every generation. Millennials, Baby Boomers and Gen Xers all have something in common — they’re stressed about their emergency savings, retirement and housing.

Every generation, from Millennials to Baby Boomers to Gen X, has varying financial pain points. However, they all have a few stressors in common — concerns over emergency savings, retirement costs and housing. When asked what financial wellness meant to them in a survey by PwC, the top answer across all generations was not being stressed about their finances.

Emergency Savings

For Millennial and Gen X employees, not having enough emergency savings for unexpected expenses topped their list of financial concerns. For Baby Boomers, emergency savings came in just behind not being able to retire when they want to as far as their most pressing financial challenge. All generations have reason to be concerned, as a recent survey by Bankrate found three in 10 U.S. adults have no emergency savings and couldn’t cover three months’ worth of living expenses.

Additionally, only 18 percent of Americans say they could live off of their savings for at least six months. Experts think part of the reason for the widespread lack of savings is that incomes haven’t kept pace with rising household expenses.

Retirement Contributions

A recent study by AARP found that at least two in five survey respondents from each generation were not confident that they will have enough money to live comfortably throughout retirement. Nearly half of people across the three generations said they hadn’t put away any money for retirement at all. This is particularly troubling, because the longer people wait to save for retirement, the longer they’ll have to work to sustain their preferred lifestyles. More than 80 percent of today’s employees expect they’ll need to work in retirement to sustain themselves financially, according to research by PwC.

More than 75 percent of AARP’s respondents also agreed that Social Security and Medicare are important to their personal retirement. An overwhelming majority of Baby Boomers (95 percent) said it’s very or somewhat important that Social Security is there for them in retirement. With the future of these programs uncertain, it’s worrisome that so many Americans are aiming to rely on these them in retirement.

Housing Costs

Although buying a house is a quintessential part of the American Dream, there are many barriers in place that prevent people from making the purchase. For Millennials and Gen Zers, the biggest obstacle to buying a house is the high cost of the down payment on a home, according to research by Freedom Debt Relief. That’s the second-biggest concern for Baby Boomers, who are most stressed about the cost of the monthly payment on a house.

Many people are also unable to afford a home because of debt that they already have. Credit card debt makes up a majority of debt that people across generations have, with 46 percent of Americans reporting they have credit card debt. This makes it one of the bigger burdens for people trying to save up more to buy a house.

All this financial stress is damaging the quality of the workplace, as employees are spending an average of 3-5 hours per week at work worrying about their personal finances. Financial wellness programs like Best Money Moves can help. Best Money Moves is mobile, gamified and easy-to-use. It provides practical, unbiased help so employees can make smarter financial decisions and manage the debt they have.

More on Financial Stress and Financial Wellness Programs

5 Must-Have Benefits for Millennial Employees

How Does Financial Wellness Affect Health?

5 Fast Financial Stress Statistics

Hiring Trends to Watch in 2020

What Is Financial Literacy and Why Is It Important?

4 Big Employee Benefit Trends for Family Planning

How Can Financial Wellness Be Improved?

Top 10 Employee Benefits for 2020

If you want to learn more about how Best Money Moves can bring financial wellness to your company download our whitepapers and sign up for a demonstration here.

How Do You Retain Employees?

by LizStevens | Aug 20, 2019 | Blog

How do you retain employees? Forty-three percent of workers will look for a new job in the next year, putting employer focus on retention strategies.

More than 80 percent of employers are concerned about retaining employees — and with good reason. Almost half (43%) plan to look for a new job in the next 12 months, according to research from global staffing firm Robert Half.

“In a tight employment market, workers have more options, and the grass may look greener somewhere else,” said Paul McDonald, senior executive director for Robert Half. “Employers can help prevent turnover by learning what motivates their most valued employees and customizing their retention strategies. While money is an important motivator, benefits or growth opportunities are also strong enticements.”

How Do You Retain Employees Looking for a New Job?

Robert Half asked respondents if there was one thing their employers could do that would convince them to stay at their current jobs. The top answer was what you’d expect: more than 40 percent of workers would stay if their employer offered them more money.

Access to more time off or better benefits would retain 20 percent of employees looking for new jobs. Nineteen percent of workers would be happy to stay at their current job if they were given a promotion. A new boss would retain only 8 percent of employees. Lastly, 10 percent of employees said there was nothing their employer could do to convince them to stay.

What Employee Retention Strategies are Companies Using?

Forty-six percent of employers are increasing communication with employees through town hall meetings and employee engagement surveys in an effort to retain more employees. Just over 40 percent of employers are improving employee recognition programs and providing professional development to improve employee retention.

Enhancing compensation and benefits is the retention strategy 40 percent of employers are using, which makes sense since more than 60 percent of respondents said more money, time off or benefits would keep them at their current job.

Other employers are providing reimbursement for ongoing education, facilitating mentorship programs or working with interim staff to prevent full-time employees from becoming burnt out.

Surprisingly, 7 percent of employers aren’t using any employee retention strategies. If they knew nearly half of their employees would be looking elsewhere within the next year, we bet they’d reconsider.