New research shows that more employers feel responsible for helping improve employees’ financial wellness as workers experience increased stress due to the COVID-19 pandemic.
Sixty-two percent of employers feel “extremely” responsible for their employees’ financial wellness, up significantly from 13 percent in 2013, according to Bank of America’s 2020 Workplace Benefits Report. The findings are based on a March 2020 survey of 808 employers that sponsor 401(k) plans, compared with the results of previous annual surveys by Bank of America.
Employers are now more likely to address broad aspects of employees’ financial lives, often by offering advice, counseling or training on saving for retirement; planning for healthcare costs; budgeting; saving for college costs; and debt management.
Benefits are shifting. Employers are adapting their financial wellness solutions to their employees’ evolving needs — and their own new budgeting constraints — according to the nonprofit Employee Benefit Research Institute (EBRI). Worker satisfaction, employee retention, and stress reduction were the top reasons for offering financial wellness initiatives.
The responses showed how the financial wellness mix has shifted. Since 2018, debt counseling and incentives around savings and financial action increased in popularity among surveyed employers. During the same period, however, firms became less likely to offer tuition reimbursement, discount programs, or bank-at-work partnerships, either because of the expense or a perception that these benefits weren’t valued by employees.
EBRI found that the most common steps taken to understand employees’ financial wellness needs were examining employee retirement plan contributions and withdrawals, surveying employees, and analyzing aggregate health data.
Moreover, employees are approaching open enrollment with a newfound determination to prepare for what’s ahead, and their personal finances are top of mind, according to benefits provider MetLife.
“In this tough environment, it’s important that employers demonstrate an understanding of employee stress, anxiety, and insecurities,” said Meredith Ryan-Reid, senior vice president and head of financial wellness and engagement at MetLife. “Workers understand that benefits play a vital role in achieving financial security and will use this year’s enrollment to be more deliberate in how they use these offerings moving forward.”