A New Focus on Financial Wellness
Healthcare is becoming more preventative, holistic, and consumer-centric. With millennials looking for a more holistic approach to health, financial wellness is becoming more of a point of focus. As more consumers take their health into their own hands, there will be increased demand for consumer-centric approaches to managing financial aspects of health. Millennials already recognize that financial stress impacts their health. In fact, two-thirds say financial stress has had a negative effect on their own physical health, according to Money.com
As a result of this newly placed importance on financial wellness, employees are increasingly asking their employers to aid in achieving and maintaining financial wellness, which financial firm Prudential defines as, “the ability to achieve the foundational elements of financial security: managing day-to-day finances, protecting against key financial risks, and achieving important financial goals”. In fact, Prudential found that individuals are more likely to utilize financial counseling, planning, budgeting, and investing tools if those services are offered by their employer.
Implications for Employers
In a survey of finance executives conducted by Prudential, 82 percent agreed their companies would benefit from having a workforce that is financially secure, and 78 percent felt employers should assist employees in achieving financial wellness during working years. Employers can do this by offering a wide range of financial wellness programs that provide, among other things, customized financial education, and access to financial professionals who can counsel employees on money management strategies, including managing student loan debt.
Managing Costs as a Millennial
More than any other generation, Millennials have been forced to take out student loans to pay for their college degrees due to the soaring cost of education. Because of this, 70% of those entering the workforce are carrying large student loan balances into their careers, preventing them from saving for retirement, building emergency saving funds, buying a home, and starting a family.
Implications for Employers
Millennials’ experiences paying for college has impacted how they think about saving for their children’s education. Many employers are beginning to introduce a payroll deduction feature, such as that offered by Goodly, for repaying student loans as part of their benefits package.
Tips for Employers: Education Planning/Student Loan Repayment
- Provide college planning resources, such as ASA Student Planning which is included for free to every Goodly user seat, to help employees understand the various options available for funding a child’s higher education—without jeopardizing the borrower’s long-term financial wellness.
- Facilitate college savings among your employee base by offering payroll deduction savings vehicles, such as 529 plans for college funding, and financial planning tools for educational goals.
- Provide student loan repayment programs as an employee benefit. While some employers directly match some of what their employees pay against their student loans, others provide sign-on and anniversary bonuses towards paying down an employee’s loan. Research conducted by Prudential has found that college graduates still paying on student loans consider employer assistance in repaying those loans just as important when deciding where to work as the availability of employer-sponsored health insurance.