BCN Services

Workers value employer-provided financial guidance

Article finance concept

Last month we learned that although general retirement confidence by several measures has improved a lot in recent years, many Americans are still worried about old-age financial security.

A lack of savings is one of the biggest factors underlying such concerns, and for a large number of people debt is the main obstacle preventing them from regularly setting more money aside.

For example, new data from the Federal Reserve Bank of New York showed that total household indebtedness in America climbed to a record high in the first quarter.  And an Alight Solutions study found that more than three-quarters of U.S. workers surveyed carry some level of non-mortgage debt with an average liability of $28,042.

Many feel they can handle debt on their own

Some 93 percent of those surveyed acknowledged that it is important to be debt-free, and 60 percent said they believe they can properly manage their debt load on their own. This is encouraging and likely a reflection of continued economic expansion and uptick in wage growth.

But even with improving conditions, there is still a risk that many are overconfident in their ability to manage their finances. For instance, 69 percent of respondents describe themselves as  “financially savvy,” and 23 percent said they believe they max out their tax-advantaged 401(k) savings, but only 6 percent of Americans actually contribute as much as possible to their 401(k) plan each year, according to Alight.

Majority of workers feel overwhelmed

Fifty-five percent of surveyed workers also admitted that they feel overwhelmed by the number of different ways they can invest their savings, and 43 percent reported that they are often intimidated by financial matters.

One thing that may be able to help is outside financial guidance, especially when provided by an employer.

Indeed, surveyed workers at firms offering some form of financial advice as a benefit were found to have a higher likelihood of saying that they “know the steps needed to ensure a comfortable retirement” and “feel in control of their financial future.” Participants in financial well-being programs were also more likely to be contributing to an employer-provided retirement savings plan and routinely setting aside money for unexpected healthcare expenses.

Employees expect help with retirement savings

Further, respondents using wellness benefits were more likely to have:

  • estimated how much money will be needed in old age
  • created a plan for achieving long-term financial goals, and
  • projected a timetable for withdrawing savings in retirement

Firms looking to attract and retain talent should also take note that 88 percent of surveyed workers said they believe employers should help with retirement saving, and nearly half would like some sort of assistance with debt management, saving for short-term needs, and establishing an emergency fund.

A majority of worker respondents also said that helpful services or tools an employer can provide are access to a personal advisor, online tools for investing and retirement planning, and web-based tools that assist with general finances, debt management, and budgeting.

Copyright @ 2019 Slavic Investments ( This edited version was republished with permission.