We’ve told you over the past few years how stressed employees are about their finances, and how worrying about their personal financial issues at work takes their attention away from their jobs. But now that we’re seeing light at the end of the pandemic tunnel, will 2022 be the year that employees relax a little about their finances and return their focus to work?
It’s looking that way, according to new research published by SoFi at Work, a holistic, financial well-being and education assistance benefits provider, and Workplace Intelligence, an HR research and advisory firm.
Despite people still struggling with their personal finances, there’s optimism across the workforce that 2022 will be a year of positive change when it comes to personal finance progress. More than 91% of employees confirmed they’ve committed to improving their financial well-being by setting financial goals for 2022. Even more important is the increased budget that 75% of employers plan to put toward financial well-being programs within the next two years to ensure employees have the tools they need to reach those goals.
“Employees are eager to improve their financial health, and HR and benefits professionals have the power to support the workforce by evolving benefits programs to meet employees’ needs and priorities,” said Barrett Scruggs, Business Lead at SoFi at Work. “Our recent research found that 51% of employees were more stressed about their finances than ever before, and that strain is taking a toll on the entire workforce. A strategic approach to financial well-being benefits can reduce employee stress that’s detracting from their engagement and foster a stronger connection between employees and the organizations they work for.”
The study, The Future of Workplace Financial Well-Being, which was conducted between December 21 through 29, surveyed 1,600 HR leaders and employees about their financial well-being, financial literacy, and financial benefits. It targeted full-time employees between 18 and 74 years of age.
Pivoting personal, professional lives
While three out of four employees (75%) are facing at least one source of major financial stress and more than half (51%) felt more stressed about their finances in 2021 than ever before, they’re pivoting their personal and professional lives.
While employees aren’t out of the woods yet, they’re taking steps to change their financial state, and providing help through their benefits can be a big boon for employers. Reason: Employees are still spending a weekly average of 9.2 hours on their personal finances, while at work.
“The pandemic fostered financial stress for many workers and their families, changing their outlook on financial well-being. But, based on our recent research, they’re more ready than ever to take action to improve their financial well-being and many are looking to employers to support them as they do so,” said Scruggs. “Access to emergency savings accounts and budget planning tools are among the top benefits employees want their employers to add or improve upon and with fierce competition for talent many businesses face today, now is the time for benefits professionals to re-calibrate and consider whether their existing offerings are aligned with employees’ needs and priorities.”
Other findings revealed that improving employees’ financial well-being could have a ripple effect in:
- driving increased worker productivity (86%)
- desire to stay with their employer (86%)
- job satisfaction/engagement at work (84%)
- ability to focus (84%), and
- improved mental (84%)/physical (80%) health.
One aspect that may be eye-opening for Benefits professionals is HR leaders said that their employees were better off financially than what the employees themselves reported. But then again, less than half of the HR leaders surveyed said their company evaluated workers’ financial status by assessing wages (45%), use of savings tools (40%), use of financial planning tools (35%), spending habits (24%) and/or debt (21%).
Top sources of financial stress
Employers can better help their employees by knowing where their top sources of stress come from:
- 40% worry about inadequate retirement savings
- 33% are stressed about credit card debt, and
- 29% struggle to afford basic expenses like rent, mortgage and/or food.
This doesn’t mean employers aren’t paying a decent salary, but it could be that employees need education on budgeting and spending habits.
But if there’s any way Benefit pros can help, they should try because survey participants reported that stress has worsened their sleep (38%), mental health (36%), physical health (27%), ability to focus at work (23%) and productivity (18%).
Financial well-being benefits are extremely important to employees. At least eight out of 10 workers say they impact their productivity (86%), desire to stay with their employer (86%), ability to focus (84%), mental health (84%), and physical health (80%).
And don’t worry, employees aren’t just expecting you to solve their financial issues. The study found workers are very eager to retain control over their finances. In fact, 91% said they have financial goals for 2022 which include:
- paying off credit card debt (39%)
- saving for retirement (38%)
- building an emergency savings fund (27%)
- saving for a personal expense (27%)
- saving for their children’s education (19%), and
- investing in stocks, bonds, or mutual funds (19%).
While many employees had financial goals last year, few achieved them. So, they’re ready and optimistic for 2022:
- 83% are motivated to improve their financial situation
- 77% said taking control of their financial situation is a top priority
- 72% are optimistic about improving their financial situation, and
- 70% are more focused on their financial well-being than ever before.
Despite this, only 53% said they know exactly what to do and how to get started to make progress toward their financial goals. And less than two-thirds (65%) said they have everything they need to improve their financial situation this year. Finally, 60% said they wished their company would do more to support their financial well-being.
Top 5 desired benefits
The top five benefits employees want their company to add or expand:
- emergency savings fund (64%)
- retirement matching/401(k) (64%)
- financial planning tools (62%)
- budget planning tools (61%), and
- homeownership assistance (60%).
And this is the top five benefits that companies are offering:
- retirement matching/401(k) (70%)
- financial planning tools (69%)
- access to a financial planner/advisor (63%)
- financial education, seminars, or courses (61%), and
- budget planning tools (58%).
Now may be the time to survey your own employees and see if the financial well-being benefits you’re offering match up with the tools your employees want.