The Concerning Direction of the Financial Well-Being of U.S. Employees

The Federal Reserve has been surveying over 11,000 households each year since 2014 to track their economic well-being. The latest research was released in May of 2023 and showed a marked decline in financial well-being from 2021-2022; the overall measurement came in at the lowest reading since 2016.¹ Here are a few key findings:

• 35% of adults said that “they were worse off financially than a year earlier”  (highest level since 2014).¹
• 31% of people with a bachelor’s degree said that “they were worse off financially than a year ago” (was only 13% in 2021).¹
• 30% of adults said they did not have emergency savings, or other means, to cover three months of expenses.¹
• 61% of non-retirees – who have self-directed retirement savings – said they aren’t very comfortable with making investment decisions regarding their accounts.¹

How many of your employees have similar concerns?

Many organizations are attending to employees’ financial concerns by offering MSA’s financial well-being program, and they expect to see the following outcomes:

• Higher Employee Retention and Engagement: Financial stress can significantly affect employee turnover. Employees that attend financial well-being events, use website tools, or work with a Money Coach, should be less distracted and more engaged in their work responsibilities.
• Reduced Absenteeism and Healthcare Costs: When employees engage with their financial well-being benefits, they should practice healthier financial habits, which reduces the likelihood of a financial crisis that could result in missed workdays.
• Attracting Top Talent: A robust education-based financial well-being program can be a valuable differentiator in today’s competitive job market.
• Positive Organizational Culture: Because MSA Money Coaches do not sell financial products, employees receive unbiased education. This can foster a sense of trust, loyalty, and a positive work environment, leading to increased employee satisfaction and morale.

Right now, employers have an excellent opportunity to provide enhanced financial well-being benefits at a time when employees desperately need them. 2024 will be here before we know it.

Here are two other ways employers can positively influence the financial well-being of employees:

1. As a result of the Secure Act, employers can enhance their retirement contribution matching program to include some form of a match in relation to an employee’s student loan payments. Employees that have federal student loans and payments that restart in October could be extremely appreciative of an employer that recognizes the challenges of sustaining retirement contributions while resuming student loan payments.
2. We are well into our second year of high inflation, and the Federal Reserve study stated that inflation was the top financial stressor for most household budgets. Employers could generate a great deal of goodwill by providing access to unbiased money coaches to help employees find creative ways to balance their household budgets without compromising the funding of their future goals.

There has never been a better time to enhance the financial well-being benefits for your employees. To learn more about how you can partner with MSA to empower employees to take charge of their financial futures, visit mysecureadvantage.com/why-msa.

¹ Federal Reserve Report: Economic Well-Being of U.S. Households in 2022. Released in May of 2023.

https://www.federalreserve.gov/publications/files/2022-report-economic-well-being-us-households-202305.pdf