High cost of living is top financial wellness issue for employers, workers

The high cost of living surpassed retirement preparedness and health care costs as the top financial wellness issue that employers are addressing for their workers.

That was one of the findings of the 2023 Workplace Wellness Survey published by the Employee Benefit Research Institute and Greenwald Research. The survey results were discussed during EBRI’s recent Financial Well-being Symposium.

Employers are responding to their workers’ financial well-being concerns, said Craig Copeland, EBRI director of wealth benefits research.

Employers focus on high cost of living

More than one-third (34%) of employers surveyed said they are trying to address workers’ high costs of living. That percentage was followed closely by addressing workers’ retirement preparedness (31%) and health care costs (28%). Other top issues employers are addressing with financial wellness initiatives include:

• Budgeting and money management (26%).
• Daily living expenses (23%).
• Financial-related stress (21%).
• Work-related stress (20%).
• Debt (16%).
• Unexpected expenses (13%).
• Stress related to personal relationships or home life (13%).
• Caregiving for children, or balancing work and parenting (13%).
• Child-related expenses (13%).
• Not saving enough (10%).
• Low wages (10%).
• Unexpected reduction in wages due to illness or disability (10%).
• Racial health and economic disparities in the workforce (9%).
• Caregiving for people other than children (8%).

“Given the persistence of high inflation, employers have stepped up in their well-being benefits to help employees save money,” Copeland said.

The Financial Well-Being Employer Survey was conducted with 252 full-time benefits decision-makers who work at companies with at least 500 employees.

Who is offering financial wellness benefits?

More than half of the firms surveyed currently offer financial wellness initiatives to their workers, Copeland said. Nearly six in 10 firms with 10,000 employees or more offer these benefits.

Employers are not only offering financial wellness benefits, they plan to expand those offerings, the survey indicated.

More than eight in 10 of those who currently offer financial wellness initiatives expect to offer a wider range of benefits in the future, while 19% said their offerings will remain the same.

Workers are wrestling with higher costs, and they are not alone. Their employers are dealing with higher costs of providing benefits, Copeland said. The survey showed 26% of employers that offer financial wellness benefits spend $100 or more per employee on those benefits. Fifty-five percent of employers offering financial wellness benefits spend $50 or less per employee on those benefits.

“One of the big things companies are telling us about offering or expanding financial wellness benefits is the cost of providing them,” Copeland said. “But even though these costs are a top concern, benefit managers said they expect their employers to provide more money for these programs. They expect the costs will increase. No one expects their budget to go down.”

But although employers are offering financial wellness benefits, employee usage of those benefits received mixed reports. More than three in 10 firms that offer financial wellness benefits said their workers use them. Meanwhile, six in 10 firms said more employees than expected use those benefits.

What financial wellness benefits are they offering?

The survey asked about 16 specific financial wellness benefits that employers could offer and found that employers offer an average of five of them, a statistic that Copeland said is roughly unchanged from last year.

Employee discount programs, basic money management tools and financial investment education are the most-offered benefits, while short-term loans through payroll deduction or debt management are offered by the fewest employers. Other financial wellness benefits employers reported offering include:

• Financial planning education.
• Tuition reimbursement or assistance.
• Personalized financial counseling.
• Education on the impact of inflation on retirement planning.
• Personalized credit or debt counseling.
• Emergency hardship assistance.
• Incentives or gamification around saving.
• Bank-at-work partnership with a bank or credit union.
• Payroll advance loans through an employer.
• Caregiving benefits.
• Student loan debt assistance.

 

Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected]. Follow her on Twitter @INNsusan.

© Entire contents copyright 2023 by InsuranceNewsNet.com Inc. All rights reserved. No part of this article may be reprinted without the expressed written consent from InsuranceNewsNet.com.