It’s no surprise to employers that too many workers are more than a little distracted from stress over how to make ends meet, leading many organizations to launch financial wellness programs. But employers have questions. Chief among them: What should such programs include, and how well do they work for employees?
Healthcare Help an Option
HR consulting firm Mercer’s 2023 to 2024 Inside Employees’ Minds study reports results from a July 2023 survey of 4,505 full-time U.S. employees working for organizations with more than 250 employees.
The results showed the No. 4 concern of the employees surveyed was being able to afford health care—behind the ability to cover monthly expenses, the ability to retire, and achieving work/life balance.
Because the cost of healthcare is such an important concern, Mercer says employers must address healthcare affordability. Low-income workers were more worried about healthcare costs, and because of the ongoing gender pay gap, more women than men were worried.
A March 2024 Mercer blog reported that 64% of organizations were enhancing 2024 health and well-being offerings, but just 3% were shifting the cost to employees. Other benefits employers were offering included free employee-only health coverage, salary-based contributions, low- or no-deductible plans, and larger health savings account contributions.
More Program Options
Helping employees handle healthcare costs is just one way employers are trying to boost employees’ financial wellness. The Mercer blog says companies are sometimes providing financial advice or coaching to all employees, not just those at the highest levels.
Also, Mercer says some employers, especially in health care, technology, and retail, are using student loan contributions to boost recruiting and retention.
Employers are also offering tuition reimbursement or assistance. That kind of help not only is a boost for employees but also “can create pathways to high-demand roles, reduce the cost of education for both the employee and the employer, and remove barriers to entry for many employees,” according to the Mercer blog, which reported that Walmart, Target, and Home Depot are starting to offer that kind of assistance.
Other options for a financial wellness program include offering free or subsidized meals and subsidized transportation, according to the Mercer blog. “Not only do these options offer financial flexibility, but they can also encourage employees to work on-site.”
Employers also may choose to offer subsidized Internet and a home office stipend for remote workers.
What Employers Offer Versus What Employees Want
Payroll and benefits software provider Payroll Integrations has released its 2024 State of Employee Financial Wellness Report, which examines how employees feel about their benefits.
One especially telling finding: Employers believe they’re supporting employees’ financial wellness, but a majority of employees don’t feel the same way. The research shows that 49% of employers believe they’re supporting employees’ financial wellness at the highest level, but just 28% of employees feel completely supported.
How to align employee and employer priorities is key for employers to understand when planning financial wellness programs. The Payroll Integrations research looked at benefit areas employers plan to invest in more or add and what areas employees prioritize.
“Employers are investing in benefits they find important – but they don’t align with employees’ priorities,” the report says, explaining that employers plan to invest the most in financial education for their employees, followed closely by health insurance and retirement plans.
Health insurance and retirement plans were at the top of employees’ lists of benefits to be improved, but just 12% of employees were interested in improved financial education and planning benefits.
The research also found that all generations—Gen Z (ages 18 to 26), millennials (ages 27 to 42), Gen X (ages 43 to 58), and boomers (age 59+)—prioritize healthcare and retirement benefits.
Like the other age groups, Gen Z workers were most interested in retirement plans and health insurance, but lifestyle compensation (reimbursements for commuting, wellness, etc.) was their next priority. The next priority after that for these workers was help with student loan and tuition payments.
Tammy Binford is a Contributing Editor.