financial stress Archives

Why Financial Wellness Is a Must-Have Employee Benefit

by LizStevens | Oct 7, 2020 | Blog

Why financial wellness is a must-have employee benefit. The demand for financial wellness programs has never been higher and employers are ready to help.

Employers are getting serious about financial wellness.

Financial wellness programs have emerged as a key employee benefit in the last few years and COVID-19 has only strengthened demand for resources that can help employees deal with their finances.

More than 60 percent of employers now feel “extremely” responsible for their employees’ financial wellness, compared to just 13 percent in 2013, according to the latest Workplace Benefits Report from Bank of America. Employers are most interested in programs that help employees save for retirement (81 percent), plan for healthcare costs (71 percent), budget (63 percent), save for college (55 percent) and manage debt (54 percent). Over 80 percent of employers agree that financial wellness programs and tools help to create more productive, loyal, satisfied and engaged employees.

Heightened interest in financial wellness programs couldn’t come at a better time as 59 percent of employees say they don’t have control over their debt and 62 percent say they don’t have enough emergency savings to last them six months.

Why Financial Wellness Is a Must-Have Employee Benefit

The issue of financial wellness is multifaceted. While most employees experience some form of financial stress, each situation is unique.

When it comes to debt, for instance, 82 percent of employees are in it, but the type of debt they have varies. According to the Bank of America Survey, half of employees have credit card debt, 46 percent have a mortgage loan and 21 percent have student loan debt. Regardless of the type of debt, 36 percent say it affects their ability to achieve their financial goals.

It’s mentioned earlier in this post that 62 percent of employees don’t have enough emergency savings to last six months, but that’s not the full story. Nearly half of employees say their emergency savings won’t last more than three months and 24 percent admit it won’t last them even one month, according to research by FlexJobs and Prudential.

As far as retirement, 71 percent of employees expect the pandemic to impact their plans, according to research by TD Ameritrade. Almost 40 percent have delayed or are considering delaying their retirement, 36 percent have decreased or are considering decreasing their retirement savings and 29 percent have withdrawn or are considering withdrawing funds from their 401(k) account. On the flip side, 47 percent of employees have increased or are considering increasing their retirement savings contributions, 29 percent of employees have opened or are considering opening a new investment account and 27 percent have converted or are considering converting their IRA to a Roth IRA.

Employees may have different financial stressors and goals, but 84 percent of them are in agreement that COVID-19 will have an impact on their ability to achieve long-term financial security and 59 percent of them say that impact will be moderate or severe.

What Employees Want From Financial Wellness Programs

Bank of America asked employees which financial resource would be most important to them if their employer were to offer it and found:

41 percent of employees want financial advice from a professional
30 percent want information on retirement plans
28 percent want the availability of financial products/services that help employees
27 percent want online financial tools or calculators
26 percent want resources on developing financial skills and good financial habits

They also noted that employees reacted positively to other forms of help, including tips for preparing for a financial shock, receiving a report card that can help them measure their financial health and even support to help them plan and take action.

How Best Money Moves Can Help

Best Money Moves has it all. It has the tools and features that help employees measure their financial stress, budget for monthly expenses, pay down debt and plan for emergencies. Our team of Money Coaches, trained professional financial counselors, are ready to give employees financial guidance whenever they need it. Employees can educate themselves about everything from investing in the stock market to co-signing loans to buying their first homes with access to a library of over 700 articles, videos and calculators. We leverage user analytics to create individualized employee content and Best Money Moves is gamified to encourage consistent engagement.

Employee information is always private but employers do have access to key analytics that show overall employee financial stress and stress levels over time. The Employer Dashboard also features information on program usage, debt and savings levels and more so employers can see just how valuable Best Money Moves is to their employees.

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.

Employee Financial Wellness During the COVID-19 Pandemic

by daniel@bestmoneymoves.com | Sep 22, 2020 | Blog

Financial wellness during the COVID-19 pandemic. How COVID-19 is impacting financial stress, and how financial wellness programs can help.

The vast majority of U.S. employees – 84% – expect the COVID-19 pandemic to impact their long-term financial wellness, according to a new study from Northwestern Mutual. The annual Planning and Progress study also found that while the pandemic is financially distressing, it actually inspires resiliency and some positive behavioral change.

Higher levels of employee financial stress are linked with lower productivity and poor financial decisions, creating a negative feedback loop. This new study showed that some employees are taking a different approach. “People appear to be cautiously optimistic about the future and a growing number are taking responsibility and action, which are key ingredients for financial planning,” said Christian Mitchell, executive vice president and chief customer officer at Northwestern Mutual.

Financial Stress Statistics During COVID-19

The most substantial result of the study is an increase in financial stress. A hefty 38 percent of participants took undesirable steps to make ends meet in the short-run. Some of those steps included:

26 percent of participants took advantage of payment deferral options
19 percent of participants pulled from their personal savings or emergency funds
13 percent of participants borrowed from a family member or friend

As a result of the tangible damages of the COVID-19 pandemic, workers expressed a declining sense of financial wellness. Nearly 60 percent of employees believe the financial impact of COVID-19 will be moderate or high. Just 35 percent of participants rated themselves as financially secure. That is a drop of 10 percentage points from the pre-pandemic statistic. On the other side of the spectrum, 19 percent of participants rated themselves as not financially secure, a seven percentage point jump from the 12 percent statistic prior to COVID-19.

Increased Demand for Financial Wellness Due to COVID-19

For many employees, COVID-19 has illuminated areas of financial stress that they would like to alleviate. More so than before the pandemic, workers are trying to meet the challenges of this economic downturn and striving for financial wellness. Fifteen percent of participants said they did not have a financial plan before the pandemic, but now created plans and 20 percent of participants said they made significant adjustments to the plans they had before the pandemic.

The pandemic also inspired a significant uptick in the number of Americans looking for financial guidance: 19 percent of Gen X, 22 percent of Millenials and 22 percent of Gen Z said they did not previously have financial advisors but are now in the market for them. As these younger generations continue to enter the workforce, their demand for financial health benefits continues to increase. It is an opportune time for employers to supply financial wellness programs.

While 84 percent of Americans COVID-19 to have a negative impact on their financial wellness, a similarly large 83 percent of Americans believe they’ll achieve long term financial security.

How Financial Wellness Programs Can Help

Now more than ever, the importance and desire for financial wellness is evident. Platforms like Best Money Moves have the support system employees are seeking.

Best Money Moves is more than a calculator and a budgeting tool. It is a user experience. We leverage user analytics to create individualized employee content and gamify the platform to encourage consistent engagement. When employees need a helping hand, our team of money coaches is always at the ready. And, of course, employee information is always private.

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 Impact of COVID-19 on Employees

by LizStevens | Jun 24, 2020 | Blog

Financial impact of COVID-19 on employees. Financial stress is high and employees are worried about healthcare costs, everyday expenses and how the pandemic will impact their retirement.

An astounding 10 percent of employees exhausted their emergency savings within the first two weeks of the pandemic, according to research by Edelman Financial Engines. Just one month into the crisis, almost a third of employees had depleted their emergency funds and stopped contributing to their retirement accounts.

“Large numbers of American workers are suffering financially, and their plight is likely to linger even after the economy begins to recover,” said Kelly O’Donnell, Executive Vice President at Edelman Financial Engines and head of the firm’s workplace business.

Financial Impact of COVID-19 on Employees

Retirement

Most employees (52 percent) are concerned about the value of their retirement savings or other investment accounts. More than 25 percent of workers have already dipped into their retirement or plan to do so soon, according to research by Bankrate. Another survey by TD Ameritrade found that over 70 percent of employees expect the pandemic to impact their senior years and more than 20 percent believe that impact will likely be severe.

Emergency Savings

Over 60 percent of employees wouldn’t be able to come up with $2,000 within 30 days for an emergency. Thirty percent would need to make sacrifices to come up with $2,000, 14 percent would have to do something drastic to raise the money and 10 percent wouldn’t be able to find the funds anywhere.

Debts and Everyday Expenses

More than half of mortgage loan and auto loan borrowers are concerned about making payments in the next few months and employees are increasingly turning to credit cards to cover everyday expenses like groceries and takeout.

Many lenders are offering some form of COVID-19 relief, most commonly forbearance, which allows employees to temporarily stop making payments on debts or make reduced payments for a certain period of time. It can alleviate some financial stress in the short term, but employees should keep in mind that the same amount of money is owed once forbearance ends and they may need to make additional payments to catch up.

According to research by Capital One and The Decision Lab, the more financially stressed employees are, the less likely they are to make smart decisions when it comes to spending and saving, which helps explain why nearly 70 percent of employees made an online purchase specifically to cope with the stress of the pandemic.

How Financial Wellness Programs Can Help Employees Get Back on Track

Nearly 40 percent of workers told Edelman Financial Engines that they could benefit from financial advice during the pandemic.

“Companies that give workers better access to financial advice can help alleviate their employees’ financial stress, leading to increased productivity, lower turnover and reduced absenteeism,” O’Donnell said.

Research by Bank of America found that 91 percent of employees who participate in financial wellness programs say those resources have helped them. And, 95 percent of employers who offer those programs agree that these support systems have been effective in reaching their company’s goals.

Financial wellness programs, like Best Money Moves, provide the guidance, tools, and support employees need to reduce their financial stress.

Best Money Moves has tools and features that help employees measure their financial stress, budget for monthly expenses, pay down debt and plan for emergencies. Employees can talk to trained professional financial counselors and educate themselves about everything from investing to co-signing loans to buying their first homes with access to a library of over 700 articles, videos and calculators.

Best Money Moves is also gamified, featuring a point-based rewards system where users earn points every time they log in, enter their information into their profile, work with their budgets, read articles and measure their stress. Each point translates into a chance to win a monthly contest.

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.

Coronavirus: Early Retirement Withdrawals and Savings by Generation

by LizStevens | May 27, 2020 | Blog

Coronavirus: early retirement withdrawals and savings by generation. New research examines how the COVID-19 pandemic has impacted retirement planning.

Initially, the coronavirus pandemic highlighted how unprepared people were for a financial disaster, putting a spotlight on the lack of emergency savings and an overreliance on credit cards. New research shows COVID-19 has also had a significant impact on long-term financial planning.

The majority of workers (52 percent) now expect to work past age 65 or don’t plan to retire at all, according to a new study by the Transamerica Center for Retirement Readiness. In light of the coronavirus pandemic, 23 percent of workers say their confidence in their ability to retire comfortably has declined.

“The long-term implications of the coronavirus pandemic and recession on retirement security have yet to be fully realized,” said Catherine Collinson, CEO and president of Transamerica Institute® and TCRS. “However, the financial vulnerabilities among workers across all generations are becoming clear.”

Coronavirus: Early Retirement Withdrawals and Savings by Generation

Millennials Retirement Withdrawals, Savings and Financial Stress

22 percent of Millennials have already taken out a loan and/or early withdrawal.
20 percent plan to take out a loan and/or early withdrawal.
Millennials have an estimated median of $23,000 saved for retirement.
26 percent of Millennials have student loan debt.
Millennials have saved an estimated median of $3,000 for emergencies.

Generation X Retirement Withdrawals, Savings and Financial Stress

15 percent of Gen Xers have already taken or plan to take out a loan and/or early withdrawal.
Gen Xers have an estimated median of $64,000 saved for retirement.
52 percent of Gen Xers have credit card debt.
Gen Xers have saved an estimated median of $5,000 for emergencies.

Baby Boomers Retirement Withdrawals, Savings and Financial Stress

10 percent of Baby Boomers have already taken or plan to take out a loan and/or early withdrawal.
Baby Boomers have an estimated $144,000 saved for retirement.
25 percent of Baby Boomers are debt-free.
Baby Boomers have saved an estimated $15,000 for emergencies.

“Although our research paints a sobering picture, it also surfaces some opportunities that can help mitigate the negative economic effects of the pandemic and improve retirement prospects,” Collinson said.

Providing financial wellness benefits, offering flexible work arrangements and on a larger scale, collaborative efforts with policymakers and industry leaders can increase awareness of relief programs like unemployment insurance and alert employees to potential alternatives to making early withdrawals from retirement accounts.

“Workers’ ability to achieve a secure retirement highly depends on a robust employment market, the availability of retirement, health, and welfare benefits, the preservation of safety nets such as Social Security and Medicare,” Collinson said. “Even amid the pandemic and current hardships, we are presented with an opportunity to come together to reimagine our world — including how we live, work, retire, and age with dignity.”

Support Workers with Better Employee Benefits in 2020

by LizStevens | May 6, 2020 | Blog

Support workers with better employee benefits in 2020. Targeting the four key aspects of employee wellness to build a better employee benefits package.

There are four key aspects to overall wellness: mental, physical, financial and social. Employees who score well across the board are more likely to be loyal, engaged and productive, according to the latest employee benefits research by MetLife.

“Now more than ever, it’s critical to understand employees’ needs,” said, Todd Katz executive vice president, Group Benefits, MetLife. “In this time of crisis and beyond, providing a mix of benefits and programs can help mitigate stress, improve employees’ holistic well-being and support them when they need it most – which in turn can help bolster engagement and loyalty from the workforce.”

Support Workers with Better Employee Benefits in 2020

The coronavirus pandemic continues to reshape the working world challenging businesses everywhere to adapt to the new normal. Strategizing how employee benefits can better support workers in a time of crisis is a must.

This year, MetLife’s 18th annual U.S. Employee Benefits Trends Report considers how resilient employees are when faced with uncertainty and then looks at the important role employee benefits plays in the overall wellness of workers, identifying the perks and programs that matter most.

Financial Wellness Programs

More than half of U.S. employees told MetLife their biggest concern in the wake of the novel coronavirus is their financial health. According to a survey by Freedom Debt Relief:

41 percent of employees are worried about being able to afford to feed themselves and their families.
41 percent report are struggling to make their rent or mortgage payments.
37 percent will miss payments on some bills in the next six months.
35 percent will use credit cards to pay for groceries.

Over 60 percent of employees say the $1,200 pandemic relief check they received as a part of the CARES Act will not be enough to get through the current economy.

“The coronavirus is clearly contributing to employees’ overall stress, especially as it relates to their financial well-being,” said Katz. “It should come as no surprise that this is particularly true among those with incomes below $50,000, and those in healthcare. Across industries, employers have an opportunity to be a source of support for employees facing unprecedented challenges by offering tools and resources to address their immediate concerns.”

Nearly 80 percent of workers with access to financial wellness programs told MetLife they’re satisfied with the employee benefits their employer offers.

The best financial wellness programs, like Best Money Moves, are gamified and harness machine learning to guide employees to the resources they need most. 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.

Mental Health Benefits

Close to 60 percent of employees struggling with mental health said their employer doesn’t offer mental health programs that meet their needs, or that the programs they do offer are too difficult to access or understand. Effective mental health programs can help ease stress, anxiety and depression that can fuel burnout and disengagement at work.

Flexibility

There was a trend towards flexible work arrangements long before the coronavirus pandemic began. Now, flexibility has shifted from being a highly sought after perk to a crucial necessity to maintain operations and accommodate workers.

Assigning reasonable workloads, offering flexible work hours or arrangements and providing sufficient time to address personal needs can mitigate stress, burnout and depression. At the same time, MetLife finds these practices are also top drivers of productivity, engagement and loyalty.

Over 80 percent of employees believe their employers have a responsibility to address their health and well-being. Employers can leverage the right mix of benefits, perks and programs to better support employees and in turn boost engagement, job satisfaction and retention.

Why Financial Wellness Is a Must-Have Employee Benefit

Why Financial Wellness Is a Must-Have Employee Benefit

What Employees Want From Financial Wellness Programs

How Best Money Moves Can Help

More on Topics Related to Why Financial Wellness Is a Must-Have Employee Benefit

Employee Financial Wellness During the COVID-19 Pandemic

Financial Stress Statistics During COVID-19

Increased Demand for Financial Wellness Due to COVID-19

How Financial Wellness Programs Can Help

More on Topics Related to Employee Financial Wellness During COVID-19

Financial Impact of COVID-19 on Employees

Financial Impact of COVID-19 on Employees

Retirement

Emergency Savings

Debts and Everyday Expenses

How Financial Wellness Programs Can Help Employees Get Back on Track

More on Topics Related to the Financial Impact of COVID-19 on Employees

Coronavirus: Early Retirement Withdrawals and Savings by Generation

Coronavirus: Early Retirement Withdrawals and Savings by Generation

Millennials Retirement Withdrawals, Savings and Financial Stress

Generation X Retirement Withdrawals, Savings and Financial Stress

Baby Boomers Retirement Withdrawals, Savings and Financial Stress

More on Topics Related to Retirement Planning, Financial Stress and Financial Wellness

Support Workers with Better Employee Benefits in 2020

Support Workers with Better Employee Benefits in 2020

Financial Wellness Programs

Mental Health Benefits

Flexibility

More on Topics Related to Support Workers with Better Employee Benefits in 2020

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