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With historic unemployment rates and economic volatility, the COVID-19 pandemic has led millions of individuals to worry about how they were going to pay for basic necessities like food and housing. In response to this crisis, employers are taking on a bigger role in their employees’ financial wellness, finds an Ayco study of companies across Corporate America.
Prior to the pandemic, many employers offered only standard health insurance or 401(k) benefits to their employees and felt that was an adequate contribution to their employees’ financially security. Some creative benefits managers were taking additional steps to support their workforce (and boost retention) through offerings to support employees’ physical health like gym memberships, and financial health through subsidized continuing education or child care reimbursements. Then the pandemic struck in early 2020 and everything changed.
Financial stress wasn’t new to many employees—but the pandemic left in its wake historic unemployment rates and economic volatility that crippled families across the country. In fact, nearly 90% of Americans reported feeling financial stress due to the COVID-19 crisis in a survey by The National Endowment for Financial Education.1 An additional 43% said they were either very or extremely concerned about their personal finance situation.2
Millions of employees, in some of the most challenging moments of their lives, suddenly experienced for themselves why conventional financial planning advice always includes maintaining an emergency fund for rainy days and adequate health care coverage. People who lived paycheck to paycheck or had put off saving for the future were suddenly caught without a safety net. The uncertainty in personal finances driven by the pandemic led more than 30% of Americans to revisit their financial plans, with the majority making significant changes.3
The pandemic proved why securing one’s financial health is as critical as caring for one’s physical health and well-being.
Companies take on a greater role in employees’ financial well-being
Even before the pandemic, employers were beginning to understand the impact financial stress was having on their employees—and the resulting impact to their business. Worrying about finances during work hours often leads to a dip in employees’ focus and performance that can ultimately reduce their productivity.
Ayco recently conducted a survey of nearly 250 HR decision-makers from across Corporate America to understand their evolving attitude toward company-sponsored benefits and supporting the needs of their workforce.
We found that financial education benefits are on the rise, as more employers take a greater responsibility for their employees' financial wellness. More than 55% of respondents now offer their employees a financial wellness benefit. And 64% of these companies provide financial planning to their entire workforce—not just executives.
Of the HR decision-makers that don’t currently provide financial planning to their employees, more than half reported their companies were considering implementing a benefit in the next 12 months. Clearly, financial planning benefits are garnering increased attention in the current economy.
Forward-thinking organizations realize that providing financial planning benefits can help workers take control of their finances, reduce financial stress, boost productivity, increase retention and improve job satisfaction. Offering employees a financial planning benefit—including onsite financial literacy programs and financial planning seminars—can help shape employee’ attitudes toward money, and create meaningful, life-long change that pays off dividends in both their personal and professional lives.
A separate Ayco survey revealed that financial education benefits saw the single biggest increase among benefits offered to organizations’ full employee population over the last two years.
We asked HR decision makers about their views on the various financial planning benefit providers in the market today.
Ayco ranked first in terms of brand favorability among the top 12 financial services companies listed in the survey. A solid 93% of HR decision makers who are aware of multiple financial planning providers have a favorable view of Ayco and its financial planning capabilities for employees. This sentiment is a reflection of the personal connection our financial professionals make with every client to help them achieve their personal financial goals.
Today’s employees need more than basic financial benefits, such as a 401(k) plan. They require comprehensive, ongoing, personalized financial planning. Partnering with an industry leader like Ayco to provide financial planning for your entire employee population can give your workers greater peace of mind while contributing to the overall productivity of your company.
Interested in offering a comprehensive financial planning benefit to your employees? Learn more about how Ayco can help your employees.
Senior Vice President, Brand Strategy & Communications