Employers are investing in workplace financial wellness, but not how employees want it

Employers are investing in workplace financial wellness, but not how employees want it
New report highlights costly disconnect between firms and employees.
JUN 27, 2024

The importance of workplace financial wellbeing plans is often noted, but a new report suggests that more could be achieved through better alignment of supply and demand.

It found that what employers think their employees want and what those workers actually want are frequently different, meaning firms are investing unwisely while employees are missing out on the support they need.

The research from Payroll Integrations and Dynata found that 49% of employers who took part believe they are completely supporting employees’ financial wellness, but only 28% of employees agree. And while employers intend that their support offsets the effects of the unpredictable economy, almost two thirds of employees still say they don’t feel financially well.

“Employees are feeling the financial pressure from inflation, higher costs of living and the rise of insurance costs and now, more than ever, employers feel a responsibility to step in to help support their financial wellbeing,” said Doug Sabella, CEO of Payroll Integrations. “But, there’s a clear disconnect between what employers think employees want in terms of financial wellness offerings and benefit programs–and what employees feel they need to make a difference.”

Among the four adult cohorts surveyed, millennials have the highest sense of financial well-being with 65% saying they are completely in control of their finances compared to 54% of Gen Xers, 38% of Boomers, and 33% of Gen Zs. Millennials also feel the most financially stable.

GETTING IT WRONG, MAKING IT RIGHT

Payroll Solutions’ new 2024 State of Employee Financial Wellness Report polled HR leaders and employees and also discovered that although 95% of employers believe they have a responsibility to support employees’ financial well-being, only 36% of employees say they feel completely financially stable.

A key example of the misalignment of employers and employees is on financial education and planning with 41% of HR leaders saying they plan to spend even more on this next year than they are now However, just only 18% of employees are interested in the programs they’re currently investing in.

Employees would prefer the investment was made in health insurance (54%) and retirement plans (43%). 

But getting consensus in multigenerational workplaces may be an extra challenge for employers, although retirement (73%) and healthcare (72%) are good bets as all four generations agree that those are the benefits they say are most important to their financial well-being with most stating these are deal-breakers when deciding on a new job offer. Employers agree this is key for recruitment and retention.

Beyond that, 44% of Boomers say pensions are most important, 46% of Gen X and Y workers say additional compensation, 31% of Millennials say Health Savings Accounts (HSA/FSA) and 38% of Gen Z employees say lifestyle compensation (ages 18-26).

“Employers need to reassess how they’re providing financial wellness support to their employees. It’s clear they want to support employees’ financial well-being, but they’re not aligned on what matters most to help them do so,” Sabella continued. “It’s up to employers to determine where to best put their resources to better support employees on their financial wellness journey.”

Latest News

Judge OKs more than $90 million in settlement money for GWG investors
Judge OKs more than $90 million in settlement money for GWG investors

Mayer Brown, GWG's law firm, agreed to pay $30 million to resolve conflict of interest claims.

Fintech bytes: Orion and eMoney add new planning, investment tools for RIAs
Fintech bytes: Orion and eMoney add new planning, investment tools for RIAs

Orion adds new model portfolios and SMAs under expanded JPMorgan tie-up, while eMoney boosts its planning software capabilities.

Retirement uncertainty cuts across generations: Transamerica
Retirement uncertainty cuts across generations: Transamerica

National survey of workers exposes widespread retirement planning challenges for Gen Z, Millennials, Gen X, and Boomers.

Does a merger or acquisition make sense for your firm? Why now is the perfect time to secure your firm’s future
Does a merger or acquisition make sense for your firm? Why now is the perfect time to secure your firm’s future

While the choice for advisors to "die at their desks" might been wise once upon a time, higher acquisition multiples and innovations in deal structures have created more immediate M&A opportunities.

Raymond James continues recruitment run with UBS, Morgan Stanley teams
Raymond James continues recruitment run with UBS, Morgan Stanley teams

A father-son pair has joined the firm's independent arm in Utah, while a quartet of planning advisors strengthen its employee channel in Louisiana.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.

SPONSORED Beyond the dashboard: Making wealth tech human

How intelliflo aims to solve advisors' top tech headaches—without sacrificing the personal touch clients crave