gen Z Archives

The Surprising Reasons Different Generations Are Stressed About Money

by Trevor Duggins | Dec 4, 2024 | For Employers

About 7 in 10 US employees say they’re stressed about money, per PNC’s 2024 Financial Wellness in the Workplace report. However, not all employees face the same financial woes. Younger generations tend to worry about affording monthly expenses, whereas Baby Boomers tend to worry about if — and when — they can afford to retire.

Engaging a multi-generational workforce can be difficult. However, by understanding each generation’s most common financial concerns, HR and business leaders can make the most of their benefits budgets while supporting employees’ financial well-being.

A stat about generations and financial stress

Financial worries can lead to lower productivity and increased turnover

Financial stress doesn’t only impact an employee and their household. Employees’ financial stress and its impacts can seep into the workplace if left unaddressed. On average, employees spend about 3 hours a week at work worrying about their personal finances, according to PNC. Over time, this distraction can lead to a loss of productivity that potentially hurts a company’s bottom line.

Moreover, employees stressed about money are twice as likely to look for a new job, according to PwC, leading to increased attrition and a loss of top talent. By learning the common financial challenges for each generation, employers can adopt impact-driven benefits designed to help alleviate all employees’ financial stress.

Generation Z & Millennials often worry about paying off their student loan debt

Generation Z, born from 1996 to 2012, is the youngest generation in today’s workforce. Gen Z employees are typically recently out of college, university or vocational training and early into their careers.
Millennials, born 1981 to 1996, alongside Gen Z face the looming burden of paying off student debt.

In recent decades, the cost of education has skyrocketed — the average undergraduate tuition has nearly tripled from 1980 to today, according to the National Center for Education Statistics (NCES). As a result, Gen Z and Millennials tend to have more student debt compared to their parents and grandparents’ generations.

Solution: Invest in student debt financing and repayment assistance offerings

Although credit card debt is the most common form of debt, studies show that student loan debt is the most challenging debt to pay off, largely due to inflation, high tuition rates and compounded interest. Over time, student debt can impact an employee’s ability to reach their financial goals, such as securing a mortgage or auto loan.

Over 1 in 3 US employees wish their employer offered student loan financing and repayment assistance benefits, according to PNC’s report. Moreover, employee benefits related to student debt aren’t just for younger generations. Tuition assistance benefits can potentially help older generations, especially those who may still carry student debt from graduate school programs or help finance their children’s education.

Generation X struggles with today’s expenses while still saving for tomorrow

In between Baby Boomers and Millennials lies Generation X. Born between 1965 and 1980, Gen X is next up for retirement, following Baby Boomers.

A common financial concern for Gen X is being able to save for retirement while balancing today’s expenses. Due to limited disposable income, sometimes employees forgo contributing to their retirement account to afford key monthly expenses, such as rent, groceries, car insurance, etc. Some employees have resorted to borrowing from their 401(k) to help make ends meet.

Today, approximately 40% of Gen X employees have $0 saved for retirement, according to the National Institute on Retirement Security. Luckily, even the oldest members of Gen X still have the runway to prepare for retirement.

Solution: Contribute to employees’ 401(k)s through match contributions

To help employees stressed about money afford today’s expenses, many companies have invested in a match contribution program. Company match programs are designed to incentivize employees to save for retirement — for each dollar an employee puts in their 401(k), employers will “match” or contribute the same amount.

Today over 50% of employers offer company match programs, compared to 46% in 2023. Match programs can help employees exponentially grow their retirement savings. This can be especially valuable for employees trying to catch up on their retirement savings.

Baby Boomers’s top concern is making sure they’re ready for retirement

Retirement readiness is the leading financial concern for employees born between 1946 to 1964, also known as Baby Boomers. Although some Baby Boomers have already retired, others are still in the workforce getting ready to enter retirement.

A common worry for Baby Boomers is if — and when — will they be able to retire. Entering retirement is a big step in a person’s life. That said, pre-retirees, including Baby Boomers, must understand how much money they need to live comfortably in retirement. This can help alleviate financial concerns, such as not having enough money to retire or potentially outliving one’s savings.

Solution: Offer 1:1 financial advising to help retirement readiness

Many employees, including pre-retirees, aren’t sure how prepared they are for retirement. Thankfully, with the support of knowledgeable financial advisors, employees can assess their retirement readiness and receive tactical steps on how to improve.

By offering 1:1 financial advising, employees can receive the personalized support they need to help address and alleviate their top financial stressors.

Need a financial wellness solution with customized solutions for every generation? Try 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.

4 Surprising Financial Facts About Millennial and Gen Z Employees

by Trevor Duggins | Jan 25, 2023 | Blog

4 surprising financial facts about millennial and gen Z employees. Your Millennial and gen Z employees are struggling with unique financial issues. Here are 4 things to know about the youngest members of your team.

Millennial and Gen Z employees struggle with unique financial issues and are turning to employers for help. A recent, in-depth survey conducted by Prudential Financial found that many employees in the younger generations are seeking additional financial assistance in order to bring stability to their lives.

Here are 4 surprising financial facts about Millennial and Gen Z employees.

1. Many millennials find their salaries insufficient and turn to outside income to support their costs of living.

According to the same Prudential study, millennials and Gen Z were more likely than Gen X or baby boomers to turn to gig work, take on debt, or receive monetary support from family to meet their financial goals. In addition, one-third of millennials and 46% of Gen Z have switched employers since the start of the pandemic, compared to 29% of all workers. Many of these workers believed that changing employers every few years was the best way to increase their earning potential. When searching for new jobs, younger generations often sought out more flexible ways of working and more financial support from their employers.

Financial wellness tools can provide employees with a snapshot of their current situation, including how much they are spending, how much they are saving, and what debts they may have. This can help employees identify areas where they may be able to improve their financial health.

2. Millennials often do not have emergency savings.

Fifty percent of all survey respondents had less than $500 or no emergency savings fund and nearly 4 in 10 respondents reported they are not on track to meet their long-term goals. The survey also found that more than half of all respondents believed that the pandemic had a negative impact on their long-term financial security. Over half of millennials said that debt prevented them from accomplishing personal goals, like owning a home and starting a family.

According to a 2021 study from the Federal Reserve, families with increased financial literacy had more savings on average and were better equipped to handle unexpected expenses.

3. Student loan debt for many millennials negatively impacts their mental health.

Almost one third of respondents said student loan debt was a barrier to accomplishing their personal goals. Offering financial wellness tools can help your own employees develop strategies to improve their own economic well-being. A 2019 study from ADP, the most recent data available, found that almost 90% of employers and employees believe that financial wellness, including student loan debt management, is important to overall well being. The study also found that 8 in 10 employees believe that companies should “take an interest in the financial well being of their workers.”

4. Millennial and Gen Z workers look to their employer for support in times of financial need.

Almost 60% of Gen Z and millennial workers believe their employer has a responsibility to help them feel more financially empowered. 29% of millennials who switched jobs in the last year took a pay cut, with over a quarter of millennials attributing the change to wanting to achieve a better work/life balance.

Financial stress can have negative impacts on mental health and may affect employees’ work performance. With financial wellness programs, employers can support their millennial and Gen Z workers to help mitigate concerns. Budgeting, savings and debt management tools simplify common money problems and help employees reach their financial goals.

Luckily, employers see improved employee outcomes by addressing financial stress head on. According to a Bank of America study, 84% of employers say that offering financial wellness tools helped increase employee retention.

Provide the unique support that millennial and Gen Z employees need by offering financial wellness tools from Best Money Moves.

If you are looking for a financial wellness program that can alleviate some employee stress, try Best Money Moves!

Best Money Moves is a financial wellness solution designed to help dial down employees’ most top-of-mind financial stresses. As a comprehensive financial wellbeing solution, Best Money Moves offers 1:1 money coaching, budgeting tools and other resources to improve employee financial wellbeing, regardless of one’s income level and background. Our AI platform, with a human-centered design, is easy to use and fit for employees of any age and financial background.

Whether it be college planning or securing a mortgage, Best Money Moves can guide employees through the most difficult financial times and topics. Our dedicated resources, partner offerings and 700+ article library make Best Money Moves a leading benefit in bettering employee financial wellness.

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.

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.

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.