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Financial Wellness Support for All Employees

Financial Wellness Support for All Employees

April 05, 2024

Amid a backdrop of rising financial concerns, including persistent inflation and record-breaking credit card debt, U.S. employees are voicing a growing need for financial planning assistance.

As plan sponsors, recognizing and addressing these concerns is not only beneficial for the overall well-being of the workforce but is also crucial for optimizing productivity and employee retention.

A Snapshot of Our Financial Stress

A recent Employee Financial Wellness survey by PwC presented a sobering view of the financial realities faced by a considerable proportion of the U.S. workforce:

  • 28% of full-time employees frequently find themselves financially strapped between paychecks.
  • Alarmingly, even those in higher income brackets aren't immune, with 15% of individuals earning $100,000 or more per year facing the same challenge.
  • Among credit card users who carry balances, 44% are grappling with making timely minimum monthly payments.

The financial strain doesn't stop at personal budgets. It bleeds into professional spaces:

  • 44% of financially burdened workers confess to being distracted by their monetary woes while on the job.
  • 36% of them are actively scouting for new employment opportunities, in sharp contrast to the 18% of their more financially secure peers.

Growing Demand for Financial Guidance

While the stats paint a worrisome picture, they also reveal a silver lining: Employees are more open to seeking help than before. A commendable 74% of workers are signaling a desire for assistance with personal finances. The stigma around financial struggles and seeking guidance appears to be waning, with only a third of employees feeling embarrassed to seek advice, down from 42% in 2019.

Implications for Plan Sponsors

Given these findings, plan sponsors have a unique and timely opportunity to step in and make a difference:

Financial Education Workshops: Regular seminars and workshops focused on budgeting, debt management, and savings can equip employees with vital tools and knowledge.

Personalized Financial Counseling: Offering one-on-one financial counseling sessions can provide tailored guidance, helping employees navigate unique challenges.

Robust Retirement Planning: Enhance existing retirement plans with educational components, helping employees to optimize benefits and plan effectively for their future.

Flexible Financial Tools: Consider introducing tools and platforms that offer financial tracking, budgeting tips, and insights, enabling employees to take charge of their finances.

Promote a Culture of Openness: By fostering an environment where employees feel comfortable discussing financial challenges, you'll break down barriers and encourage proactive seeking of help.

Regular Feedback & Iteration: Regularly survey employees to understand their evolving financial needs, ensuring that the support you offer remains relevant and effective.

The Time to Act is Now

As the line between personal financial well-being and professional productivity becomes increasingly evident, plan sponsors have a crucial role to play.

By acknowledging the challenges faced by employees and offering targeted financial wellness support, plan sponsors can contribute to a more secure, focused, and contented workforce.

The time to act is now – your employees are asking for help.

 

Important Disclosures

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by FMeX.

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