Helping Employees Thrive in the ‘New Normal’

Even prior to the new coronavirus pandemic, Americans were stressed about money. In fact, financial stress has been cited as the top cause of stress and a major distraction at work for nearly a decade.¹ However, many are hopeful as the world reopens and we turn our focus to thriving in a “new normal.”

Before the crisis, a Financial Health Network survey of 1,000 full-time employees of mid-sized and large U.S. firms revealed that 50% of employees spend more than they earn each month. What’s more, 37% have more debt than they can manage, and 41% do not have enough savings to cover three months of living expenses.²

However, the crisis appears to have spurred better financial habits. According to a June 2020 NerdWallet survey, 41% of respondents report saving more and 48% report spending less now than before the pandemic.³

Employees are looking to employers for help improving their financial wellbeing. And with the strides they’ve recently made by adjusting their financial behaviors, employers have an opportunity to help their people gain momentum through financial wellness support and savings benefits.

Supporting Employees in Their Financial Journey

Everyone is on their own unique financial journey. However, the path to Financial Wellness has a few distinct trail markers: security, foundation, growth and freedom.⁴ Helping your employees identify these stages and offering dynamic programs and resources can help them thrive.

Here’s how employers can help employees at each of their four key phases:

• Security: The first stage entails understanding income and managing expenses and debt; 31%* of employees identify with being at this stage. Support employees in this phase by offering debt management and budgeting resources and educating them on the importance of emergency savings. 

• Foundation: This stage focuses on establishing savings goals and understanding investments and insurance; 21%* of employees find themselves at this stage. Employees in this phase could benefit from student loan repayment programs and tools to help them track their savings goals. 

• Growth: More than one-third of employees (37%*) say they are in the growth phase, where they are dedicated to maximizing asset growth and understanding investment vehicles. Financial solutions to consider for employees in the growth phase include investment management, insurance, and philanthropy management services. 

• Freedom: This could also be considered the pre-retiree phase, where 11%* of employees say they are focused on estate planning and understanding their Social Security options. Webinars or one-on-one education on Social Security as well as trust and estate planning strategies would be helpful for these employees.
  
  ^{*Alight Solutions, Financial Mindset Study, 2017.}

Meeting Employees Where They Are

In an ideal world, your employees would progress from one stage to the next on a smooth, predictable path. But that is rarely how things pan out. During periods of market volatility or economic stress, employees may face savings setbacks and feel less confident in their financial picture.

That is why offering a multifaceted Financial Wellness program—one that addresses different employee needs at different financial stages—can be so valuable. Encouraging employees to take control of their financial lives and get the support they need, wherever they are on their financial journey, is key to helping both your people and your organization thrive in the new normal.